Hilltop Securities, Inc.

Date:

August 19, 2020

Type of alert:

FINRA AWC  

The Financial Industry Regulatory Authority (FINRA) Department of Enforcement recently approved a Letter of Acceptance, Waiver and Consent (AWC) submitted by Hilltop Securities, Inc., a FINRA member firm since 1972 that conducts a full-service brokerage business headquartered in Dallas, Texas, and currently has 69 office branches with approximately 492 registered individuals.

FINRA alleges in the AWC that between February 1, 2015 and April 30, 2016, Hilltop failed to establish and implement an AML compliance program designed to detect and report suspicious trading activity in low-priced securities. During this time period, Hilltop customers traded at least 2.07 billion shares of low-priced securities that were valued at approximately $221 million.

FINRA claims that these shares were not subject to review and follow-up investigation of red flags to file a suspicious activity report (SAR). Specifically, FINRA claims that Hilltop Securities failed to: 1) follow federal standards for determining factors to file a SAR, including proof of actual versus suspicious fraudulent activity; 2) implement AML procedures which requires completing Deposit Review Forms in connection with low-priced securities; and 3) reasonably detect and report suspicious trading activity through its compliance program. Thus, Hilltop Securities missed red flags of potentially suspicious activity, only reviewing 20% of the transactions, of which did not include the highest risk transactions.

FINRA further claims that Hilltop failed to: 1) submit Form G-32 information to the Electronic Municipal Market Access System for 122 primary offerings of municipal securities; 2) provide required MSRB Rule G-17 disclosure letter to issuers for 119 of 122 offerings; and 3) report on form G-37 that it had conducted municipal business.

Accordingly, FINRA asserts that Hilltop violated FINRA Rules 3110(a) and 2010 and MSRB Rule G-32, G-17, and G-37. By signing the AWC, Hilltop Securities consents to a censure, $475,000 fine, and engaging an independent consultant to conduct a review of the firm’s policies, systems, and procedures.

Take the next steps to find out if you have a claim:

Step 1.

Talk to an Experienced Attorney Today

Call and speak to one of our attorneys* for a no-cost consultation to discuss your situation, answer your questions, and help you determine the next steps. This call usually takes about 15 minutes, but we are happy to talk to you as long as you would like!

Step 2.

Quick Review of Your Paperwork

If we think you might have a case, we will need to review a few basic documents. If we determine you have a case, then you will have the option to hire us as your attorneys to pursue it.

Step 3.

Signed Attorney/Client Agreement

If you decide to hire us to pursue your case, we will have you sign an attorney-client agreement so we can begin the process of trying to recover your losses.*

*In the vast majority of cases, our agreement is contingent – meaning you won’t owe us any money unless we recover money for you.


Request a Consultation

This site contains attorney advertising. The attorneys at ChapmanAlbin are licensed to practice law in Ohio and Michigan. Any reference to past cases or successes made herein should not be construed as a guarantee of any future outcome. Each client and each client’s case is unique, and no result or outcome is or can ever be guaranteed. The information provided in this website is offered for general information purposes only; it is not offered as and does not constitute legal advice in any way. // Disclaimer