FINRA Sanctions Woodbury Financial Services for Variable Annuities Supervisory Failures
According to the Financial Industry Regulatory Authority (FINRA), the regulator has sanctioned Woodbury Financial Services (CRD #421, Oakdale, Minnesota) on May 13, 2019. A Letter of Acceptance Waiver & Consent was reportedly issued in which the firm was censured and fined $225,000.
The firm reportedly consented to the sanctions stemming from allegations that its system for supervising additions to existing variable annuities was not reasonably designed to achieve compliance with securities laws and FINRA rules, including suitability rules.
FINRA’s findings stated that the firm did not use surveillance tools, such as exception reports, to monitor additions to variable annuities and provide the firm with information about potentially unsuitable transactions.
According to FINRA, the firm’s review system did not provide itself with sufficient information to prevent potential suitability violations, including additions resulting in customers investing a high concentration of their net worth in variable annuities.
For FINRA’s full findings see FINRA Case #2017053596502.
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