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FINRA fines Pruco, orders restitution over improperly supervised mutual fund sales

Dec 27 2012 Stuart Gittleman, Compliance Complete

Pruco Securities was fined $550,000 and ordered to pay restitution and interest to customers who placed mutual fund orders by facsimile or mail and received inferior prices, the Financial Industry Regulatory Authority said Wednesday. Without admitting or denying FINRA's findings, Newark-based Pruco agreed to be censured and to pay at least $10.7 million to remedy pricing errors that persisted from late 2003 to June 2011 and affected as many as an estimated 37,240 customers. FINRA said that in determining the sanctions to be imposed, it considered that Pruco self-reported the errors, conducted an internal review, changed its policies and procedures, and started paying restitution to some of the affected customers. "Pruco's inadequate supervision and pricing system resulted in thousands of customers receiving inferior prices for more than seven years. Broker-dealers must ensure that their systems provide customers with accurate pricing for all products that the firms offer," said

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