FINRA levied $41.1 million in fines in 2010
Some 1,173 disciplinary actions were taken and $41.1 million of fines were levied this year by one regulator, including the largest number of insider-trading cases ever. The Financial Industry Regulatory Authority has referred 244 insider-trading cases to the Securities and Exchange Commission. FINRA also launched its office of fraud detection and market intelligence this year and referred 255 matters of fraud to the SEC through November. The independent regulator said it secured about $8 million in restitution for investors, while expelling 14 firms from the securities industry, barring 270 individuals and suspending 407 others from association with FINRA-regulated firms. The total number of disciplinary actions was up slightly over the year-ago period. For 2009, FINRA filed 1,158 disciplinary actions, expelled 20 firms, barred 383 people and suspended 363. The figures are roughly in line with those of the past five years. "While the regulatory environment continues to evolve, each of the efforts undertaken by FINRA this year contributes to our broader mission to protect investors by making sure the securities industry operates fairly and honestly, both in its dealings with individuals and through the operation of the systems and technologies that underpin today's markets," according to Chairman and CEO Richard Ketchum. Within housing finance and the secondary market, FINRA said the collapse of mortgage-backed securities led to a number of investigations regarding how the debt is underwritten and sold to investors. In July, the regulator settled one action against Deutsche Bank Securities was fined $7.5 million after being found to have "negligently misrepresented and underreported the percentages of mortgages that were delinquent in the prospectus supplements of six subprime" in RMBS issued in 2006. Write to Jason Philyaw.