FINRA Fines Osaic Institutions $650,000 Over AML Program Deficiencies

The Financial Industry Regulatory Authority (FINRA) has fined Osaic Institutions, Inc. $650,000 and issued a censure for deficiencies in its anti-money laundering (AML) program. The regulator found that the firm, previously known as Infinex Investments, failed to maintain an adequate system to identify and report suspicious activity from 2021 through late 2023.

According to the settlement, Osaic relied on exception reports that failed to capture red flags, including third-party wire transfers and transactions involving high-risk jurisdictions. In several instances, these reports were either not reviewed or were reviewed months late, affecting the firm's ability to detect suspicious money movements. Osaic has been registered with FINRA since 1994 and operates approximately 950 branches.

FINRA also stated the firm failed to conduct ongoing customer due diligence. Specifically, Osaic did not develop risk profiles for domestic clients and only designated foreign accounts as high-risk in late 2023. The firm also lacked procedures for updating customer information on a risk basis.

Osaic agreed to the sanctions without admitting or denying the findings. The firm must certify within 60 days that it has remediated the issues and implemented a compliant AML program. The settlement resolves alleged violations of FINRA Rules 3310 and 2010.