The Financial Industry Regulatory Authority has fined Oppenheimer & Co $675,000 for charging unfair prices in municipal securities transactions and for failing to have an adequate supervisory system.
The Financial Industry Regulatory Authority has fined Oppenheimer &
$675,000 for charging unfair prices in municipal securities transactions and
for failing to have an adequate supervisory system.
The authority also ordered Oppenheimer to pay over $246,000 in
plus interest, to clients who were charged unfair prices. In addition, FINRA
fined Oppenheimer's head municipal securities trader, David Sirianni, $100,000
and has suspended him for 60 days.
Between July 1, 2008, and June 30, 2009, Oppenheimer - via
Sirianni - allegedly priced
89 client transactions from 5.01 per cent to 15.57 per cent above the firm's
“Sirianni purchased municipal securities from a broker-dealer
Oppenheimer's behalf, held the bonds in inventory for at least overnight, and
then made the bonds available for resale at an unfair price to the firm's
customers. Sirianni was responsible for determining the prices paid by customers
in the 89 transactions,” FINRA said.
It added: “Oppenheimer's supervisory system was deficient
supervisory personnel relied solely on a surveillance report that only captured
intra-day transactions to review the fairness of markups/markdowns in municipal
Oppenheimer and Sirianni neither admitted nor denied the charges,
consented to the entry of FINRA's findings.
At the end of August, US authorities charged a former portfolio
Oppenheimer with misleading investors about the valuation and
performance of a fund consisting of other private equity funds (see here).