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FINRA Fines NEXT Financial Group $1 Million for Supervisory Failures
Posted by: Jeffrey B. Kaplan
September 04, 2009

FINRA Fines NEXT Financial Group $1 Million for Supervisory Failures

Former Chief Compliance Officer Fined and Suspended

The Financial Industry Regulatory Authority (FINRA) announced that it has fined Houston, Texas-based brokerage firm NEXT Financial Group, Inc. $1 million for supervisory violations. According to FINRA, between January 2005 and November 2006, NEXT allowed branch managers to supervise their own handling of customer accounts without adequate review. Although NEXT ultimately adopted a Regional Manager supervisory system to provide review of the branch managers' transactions, FINRA determined that this new system also was inadequate because, among other reasons, it required three Regional Managers to review thousands of transactions each month with limited access to client suitability information.

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