FINRA Sanctions Hilltop Securities, Dallas, Texas
According to the public records on FINRA’s website, on September 23, 2019, the regulator reportedly sanctioned Hilltop Securities (CRD #6220, Dallas, Texas) with a censure and a $250,000 fine.
From 2015 through the present, Hilltop allegedly failed to establish procedures reasonably designed to assure that customers received the initial margin interest rate disclosures and failed to establish, maintain, and enforce a supervisory system, including written supervisory procedures, reasonably designed to achieve compliance with FINRA rules.
Apparently many customers allegedly did not receive the initial disclosure stating the annual rate or rates of margin interest that could be imposed. The initial disclosure is designed to ensure that a customer, before account opening, understands the terms and conditions under which margin interest charges will be made, and to enable the customer to compare the various credit terms available.
Further, FINRA found that Hilltop’s supervisory system and written supervisory procedures were reportedly not reasonably designed to assure that each customer was provided, at the time of account opening, the rate or rates of margin interest that Hilltop could charge.
For FINRA’s full findings see FINRA Case #2018060195201.
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