Brown Brothers to Pay $8 Million Over Finra ClaimsDavid McLaughlin
Brown Brothers Harriman & Co. agreed to pay $8 million to settle regulatory claims that it lacked an adequate anti-money laundering program and failed to detect suspicious penny-stock transactions, the brokerage industry’s self-regulator said.
New York-based BBH from 2009 to 2013 executed transactions or delivered securities involving at least six billion shares of penny stocks, many on behalf of undisclosed customers of non-U.S. lenders in countries with less stringent anti-money laundering regulations, the Financial Industry Regulatory Authority said in a statement today.
“The firm opened its doors to undisclosed sellers of penny stocks from secrecy havens without regard for who was behind those transactions, or whether the stock was properly registered or exempt from registration,” Brad Bennett, Finra’s head of enforcement, said in a statement.
In settling the claims, BBH didn’t admit or deny wrongdoing, according to the statement.
BBH has made changes to its handling of low-priced securities and surveillance, the company said in an e-mailed statement. The conduct included in the settlement didn’t involve the firm’s investment-management or private-banking businesses, the company said.