Lucia Securities, LLC, a brokerage firm headquartered in San Diego, California, has been censured and fined $35,000.00 by Financial Industry Regulatory Authority (FINRA) by consenting to findings that the firm failed to supervise and preserve consolidated reports which had been distributed to the firm’s customers. Letter of Acceptance, Waiver and Consent, No. 2017055425901 (Jan. 9, 2018).
According to the AWC, the firm distributed documents to customers that combined information pertaining to the assets owned by customers at Lucia Securities, LLC as well as with other firms. Particularly, between January of 2016 and December of 2016, twenty of the firm’s employed representatives had established and transmitted at least eleven hundred Wealth Analysis Reports to customers.
The AWC stated that the firm’s supervision systems during this period were flawed because they did not consider that consolidated reports had been utilized, causing the firm not to utilize its supervisory protocols to make sure that the Wealth Analysis Reports were not misleading, inaccurate or unclear.
Further, the firm neglected to follow its own requirements for preserving documents. Evidently, registered representatives’ utilization of the consolidated reports went unmonitored. FINRA found that the firm’s supervisory failures were violative of FINRA Rules 2020 and 3110. Additionally, the firm’s failure to preserve the reports was conduct violative of FINRA Rules 2010 and 4511, as well as Securities and Exchange Act Section 17(a) and Rule 17a-4(b)(4).
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