The United States Financial Industry Regulatory Authority (FINRA) has accepted an offer of settlement submitted by Jefferies LLC. According to the offer, Jefferies agrees to a censure and a fine of $55,000.
From August 1, 2018 through October 31, 2018, and June 1, 2019 through November 30, 2019, Jefferies failed to report to TRACE 982 and 3,057 transactions, respectively, in corporates within 15 minutes of the time of execution.
The 4,039 total late reports were caused by several different issues at the firm, including delays related to a manual reporting process involving trades with foreign affiliates, operational errors and delays by firm personnel, such as firm employees not timely matching tickets in the firm’s system, and amendments to trade terms outside of the 15-minute reporting time frame.
FINRA Rule 6730(a) states, in relevant part, that “[e]ach member that is a Party to a Transaction in a TRACE-Eligible Security must report the transaction. . . . as soon as practicable, but no later than within 15 minutes of the Time of Execution, except as otherwise specifically provided [in this Rule]. Transactions not reported within the specified timeframe will be designated as late.”
FINRA finds that Jefferies has violated this rule.
This is not the first time Jefferies is fined for similar violations. On December 27, 2017, FINRA accepted an offer of settlement in which Jefferies was censured and fined $37,500 for Trade Reporting and Compliance Engine (TRACE) reporting (FINRA Rule 6730) and related supervisory (FINRA Rule 3110) violations that occurred from October through December 2015.