B.C. Ziegler Fined For Supervisory Gap in Church Bond Pricing and Sales
FINRA has fined Chicago-based brokerage firm B.C. Ziegler & Company for failing to establish and maintain a supervisory system to ensure that material economic information was disclosed to the firm’s sales staff and customers who were sold church bonds in secondary market transactions.
According to FINRA, B.C. Ziegler & Company collected information on sinking fund payments, a way used by issuers to make periodic repayment to issued bonds, but did not have policies or procedures addressing the dissemination of this information to registered representatives, the trading desk or customers. The firm’s supervisory system was not reasonably designed to consider material economic information in the pricing of church bonds in secondary market transactions. Because there was no active secondary market for church bonds, the firm set the prices at which it repurchased and resold the bonds. That resulted, unfortunately, in pricing that was similar for both current and delinquent bonds with sinking fund payments.
B.C. Ziegler & Company also distributed internal-use-only sales materials to its registered representatives without including sufficient risk disclosures.
The attorneys of Eccleston Law Offices represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 50 years in delivering the highest quality legal services.
Related Attorneys: James J. Eccleston