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FINRA imposes a fine on Merrill Lynch of PLN 825,000. dollars for delays in order processing | News Short

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The company failed to establish and maintain written supervisory procedures reasonably designed to achieve compliance with its best execution obligations, FINRA said in a disciplinary notice released Thursday.

The self-regulatory organization found that Merrill Lynch violated FINRA Rules 3110 and 2010.

Details: From at least February 2017 to the present, Merrill Lynch “failed to adequately supervise whether it made reasonable efforts to fully and timely process tradable customer orders it received,” FINRA alleges.

During this period, the company had five electronic ordering systems that processed hundreds of millions of orders. As part of its validation checks, Merrill Lynch only examined the timeliness of execution of orders processed through the systems from the time the orders were routed to the market center for further processing or execution and the final execution time, FINRA said, and did not review how long it took for the systems to process and route orders to the shopping center.

The notice alleges that the firm failed to comply with FINRA and the Securities and Exchange Commission’s recordkeeping requirements by failing to ensure the accuracy of information contained in order records relating to retail brokerage stock orders received electronically.

Compatibility Notes: The case stems from a review conducted by FINRA’s Market Regulation Department, the organization said.

FINRA also noted that the allegations related to capital orders from Merrill Lynch’s retail clients and not institutional orders from BofA Securities, under which the firm has operated its investment banking and institutional brokerage businesses since May 2019.

A Merrill Lynch representative at Bank of America did not immediately respond to a request for comment.