Each month, FINRA publishes disciplinary actions involving firms and registered individuals that violated FINRA rules, federal securities laws, regulations, or Municipal Securities Rulemaking Board requirements.
The actions reported in September 2026 addressed deficiencies involving anti-money laundering programs, best execution, variable annuity recommendations, Regulation Best Interest, and limit order display obligations. Many were resolved through Letters of Acceptance, Waiver and Consent, in which firms accepted the sanctions without admitting or denying FINRA’s findings.
Here are the five largest fine amounts included in FINRA’s September report and what compliance teams can learn from them.
1. $20 Million: Anti-Money Laundering
The largest fine was $20 million for repeat AML violations involving foreign currency wire monitoring and customer due diligence.
FINRA found that the firm:
- Failed to reasonably monitor more than 60,000 foreign currency wires totaling over $10 billion
- Used an automated tool that omitted approximately 33% of certain wire activity
- Failed to identify and investigate several customer risk factors
- Assigned some customers risk ratings that resulted in less scrutiny
The firm had previously been fined $4.5 million for similar foreign currency wire monitoring deficiencies. However, FINRA found that the problems continued through June 2023.
The firm initially relied on quarterly manual reviews of reports containing thousands of transactions. A later automated system also contained incomplete data and excluded significant activity.
Customer due diligence reviews also missed connections to high-risk locations, unexplained changes in domicile or employment, adverse media, and possible political exposure. As a result, the firm did not detect and report certain suspicious transactions.
2. $850,000: Best Execution
A firm was fined $850,000 for failing to conduct reasonable reviews of whether customers received best execution on equity orders.
FINRA found that:
- More than 8.8 million orders were routed exclusively to five market makers
- Each market maker paid the firm for order flow
- Reviews only evaluated the venues already receiving the firm’s orders
- Competing market centers were not considered
The orders represented more than 1.7 billion executed shares between 2020 and 2022.
Although the firm’s best execution committee met quarterly, its reviews did not determine whether competing venues could have provided better execution quality. The firm’s written procedures also lacked requirements for comparing market centers or reviewing execution quality by order type.
The action demonstrates that regular reviews are not necessarily reasonable reviews. Firms need to consider whether their methodology evaluates the full range of available execution options.
3. $475,000: Variable Annuities and Reg BI
A firm was fined $475,000 and ordered to pay $634,488.56 in restitution for supervisory failures involving variable annuity exchanges and Regulation Best Interest.
FINRA identified several concerns:
- A representative recommended 88 unsuitable variable annuity exchanges
- Customers paid more than $561,000 in surrender fees
- Some customers lost appreciated living benefit riders
- Other customers paid approximately $73,000 in additional fees
The firm’s procedures did not provide sufficient guidance for evaluating surrender charges, lost benefits, exchange rates, share classes, or account types. Its surveillance also failed to identify and investigate red flags associated with the recommendations.
FINRA further found that the firm’s policies did not reasonably address conflicts created by incentives to recommend products and services that generated both commissions and fees.
4. $275,000: AML Surveillance
A firm was fined $275,000 because its automated AML monitoring rules failed to identify suspicious money movements.
FINRA found that:
- Three monitoring rules were configured with ineffective parameters
- The rules failed to generate useful alerts
- Responsibility was divided between two groups without adequate coordination
- Concerns about ineffective monitoring were not properly escalated
The firm did not regularly test whether its monitoring rules were identifying the activity they were intended to detect. Consequently, ineffective rules remained in place for years, and potentially suspicious transactions were not identified, investigated, or reported.
The firm later updated its procedures to require periodic assessments of its automated transaction monitoring rules.
5. $100,000: Limit Order Display
A firm received a total fine of $100,000, with $20,000 payable to FINRA, for supervisory failures involving limit order display requirements.
The firm’s control failures included:
- Automated exception reports that stopped functioning
- A manual review that could not reasonably address the volume of orders
- A period without manual reviews after the responsible employee left
- Procedures that lacked review frequency, volume, and sampling requirements
From June 2021 through August 2022, the firm did not conduct manual reviews for potential violations after its automated reports failed and the employee performing the replacement review departed.
The firm’s procedures also did not explain how reviewers should determine whether a violation occurred. It later implemented a new automated exception report and updated its written procedures.
Compliance Takeaways
The largest fines reported in September point to four areas compliance teams should review:
- Confirm remediation is effective. Corrective action should address the underlying issue and be tested to ensure previously identified deficiencies do not continue.
- Test automated surveillance. Firms should verify that data feeds are complete, alert thresholds capture intended activity, and system changes do not create monitoring gaps.
- Match reviews to actual activity. Manual processes, sampling methods, and supervisory reviews should account for transaction volume, products, customers, and business risks.
- Define ownership and escalation. Procedures should identify who monitors each control, how often reviews occur, when concerns are escalated, and how conclusions are documented.
Across these actions, firms often had monitoring systems, committees, or written procedures in place. The deficiencies arose because those controls were incomplete, poorly configured, too limited in scope, or not followed when problems emerged.
Effective supervision requires more than establishing a control. Firms must test whether it works as intended, respond when weaknesses are identified, and confirm that corrective action resolves the underlying risk.
