Raymond James, RBC fined $1.4 mln over stock loans
NEW YORK, June 17 (Reuters) - A U.S. regulator said on Wednesday it fined Raymond James Financial Inc (RJF.N) $1 million and Royal Bank of Canada's (RY.TO) RBC Capital Markets unit $400,000 for improper practices related to stock loans.
Raymond James was punished for making improper payments to "finder firms" that provided no help in locating securities or had no involvement in transactions for which they were paid.
Raymond James and RBC were also fined for each allowing a finder who had been convicted of securities law violations and barred from the industry to perform stock loan functions.
Separately, Benedict Patrick Tommasino, the head trader of RBC's stock loan department, was suspended from the securities industry for 20 months and fined $30,000.
"Finders for stock loan transactions can play an important role in the markets by assisting borrowers in locating securities, especially hard-to-borrow stocks," said FINRA enforcement chief Susan Merrill. "But Raymond James traders made unjustified payments to finders who provided no service. Moreover, both firms exposed the market to the activities of an unqualified and unsupervised individual."
FINRA regulates close to 4,900 brokerages. It said Raymond James, RBC and Tommasino did not admit wrongdoing, but consented to the findings. (Reporting by Jonathan Stempel; Editing by Derek Caney)
