National Securities Corporation is a licensed brokerage firm based in Seattle, WA. The firm registered with the Financial Industry Regulatory Authority (FINRA) in 1947, and is licensed to operate in 53 U.S. states and territories.
National Securities has a history of regulatory and customer complaints, and currently has 59 regulatory events, 12 arbitrations and 2 civil disclosure events on its FINRA BrokerCheck report. Of note, in December 2014, FINRA censured and fined National Securities $35,000 for reclassifying customer complaints as sales practice violations and for filing late reports about customer complaints and settlements. The findings stated that National Securities failed to enforce its written supervisory procedures (WSPS) regarding required reporting.
In November 2014, FINRA ordered the firm to cease and desist selling non-investment grade or "junk" bonds issued by the Commonwealth of Puerto Rico. National Securities was selling the bonds below the minimum denomination of the issue in violation of MSRB (Municipal Securities Rulemaking Board) Rule G-15 (F). The rule is intended to limit sales of municipal securities because they may not be suitable for retail investors. National Securities was fined $60,000, ordered to review and improve its policies and procedures and conduct training to ensure compliance with the MSRB Rule within the following six months. In October 2013, FINRA fined the firm $18,000 and ordered to pay nearly $9,000 plus interest in restitution to its clients after FINRA found it failed to buy and/or sell bonds at a fair price. In July of that year, National Securities was fined $40,000 for operating while net capital deficient due to inaccurate financial reporting.
In December 2012, National Securities was fined $65,000 for failure to establish, maintain and enforce supervisory procedures and internal controls that would detect and report suspicious transactions and money laundering. FINRA found the firm ignored or failed to identify red flags and did not have a system in place to review trading activity on a firm-wide basis. In December, 2011, FINRA ordered National Securities to pay a $82,500 fine and pay $1,640.15 in restitution to customers for failing to execute orders fully and promptly, and for failing to buy or sell securities at prices favorable to their clients. FINRA also found the firm incorrectly reported to the FINRA/NASDAQ Trade Reporting Facility (FNTRF) its capacity as "agent" and/or "principal" on numerous transactions, and exhibited a "pattern or practice" of late reporting.
In 2004, National Securities was fined $300,000 and given a 30-day suspension from opening new mutual fund accounts for prospective customers. FINRA's predecessor, the National Association of Securities Dealers (NASD) found National engaged in deceptive market timing activities and failed to have a supervisory system in place to detect and prevent such practices. In addition, the firm failed to keep emails as is required by securities laws and NASD rules. NASD fined National's former president $25,000 and suspended him for 30-days for supervisory failures and failing to respond to red flags raised by the deceptive activities. Cold Spring Advisory is working with clients to recover capital they loss with National Securities Corporation. If you or someone you know suffered losses with National Securities Corp, please contact us today. We will analyse your National Security account(s) for free and let you know if you have an eligible case for capital loss recovery.