TD Bank Brokerage Unit Settles FINRA Case Alleging Oversight Gaps in Email Monitoring
From the desk of Jim Eccleston at Eccleston Law
TD Private Client Wealth (TDPCW), a broker-dealer subsidiary of TD Bank, has agreed to pay a $600,000 fine and be censured following an investigation by the Financial Industry Regulatory Authority (FINRA).
The regulatory body alleged that TDPCW, from February 2013 to July 2022, neglected to establish a system for reviewing correspondence and internal communications for compliance purposes. During that period, TDPCW, distinct from TD Ameritrade (acquired by Charles Schwab & Co in 2020), failed to assess around 3.5 million emails linked to 691 employee email accounts due to its inadequate supervisory system, as outlined in an Acceptance, Waiver and Consent (“AWC”), according to AdvisorHub.
TDPCW has approximately 585 registered representatives and operates across 40 branch office locations.
The unit's actions were deemed a violation of FINRA Rule 3110, which mandates firms to review electronic correspondence of associated persons and internal communications related to securities business. Additionally, it breached Rule 2010, requiring the observation of "high standards of commercial honor.” FINRA is mandating that TDPCW certify within 90 days the completion of a review of all emails spanning the nine-year investigation period. Furthermore, within 120 days, TDPCW is required to establish a supervisory system and written procedures addressing the previously identified flaws.
Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.
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