B-D Park Avenue Securities Fined $195,000 for Failing to Supervise
Financial Industry Regulatory Authority Department of Enforcement
Park Avenue Securities, LLC
Background: Park Avenue Securities, LLC has been registered with FINRA since 1999. The Firm primarily engages in the sale of mutual funds and variable annuities in addition to providing investment advisory services.
In November, 2011, Park Avenue Securities consented to a censure and a $175,000 fine after violating NASD Rules 3010 and 2110 by failing to conduct an adequate investigation of an unapproved private securities transaction and failing to establish and maintain an adequate supervisory system to review electronic communications.
Overview of Allegations: From August 2010 to December 2013 Park Avenue Securities failed to enforce its written supervisory procedures regarding the monitoring of customer trades and failed to establish and maintain a supervisory system to follow up on the performance of its supervisors with respect to monitoring trade executions.
Additionally, the firm failed to establish, maintain and enforce a system designed to review and monitor the movement of funds from the accounts of its customers to third party accounts and outside entities. As a result, the firm failed to detect unauthorized sales of securities and the wiring of funds by an unregistered administrative assistant who misappropriated approximately $255,300 from the Park Avenue Securities accounts of two elderly customers over more than three years.
Result: Park Avenue Securities consented to a censure and a fine in the amount of $195,000.