FINRA Fines Vanguard Marketing Corporation $950,000 for Cost Basis Reporting Errors

Vanguard Marketing Corporation (VMC) has agreed to pay a $950,000 fine as part of a settlement with the Financial Industry Regulatory Authority (FINRA), the regulator said. The firm also agreed to a censure.

According to FINRA, from approximately 2012 to 2023, a series of technical issues caused VMC to communicate inaccurate information to customers regarding the cost basis of their investments in account statements, trade confirmations, and Forms 1099. These actions violated FINRA Rules 2210, 4511, and 2010.

FINRA further stated that VMC failed to reasonably investigate red flags related to the inaccurate information on these documents, violating FINRA Rules 3110 and 2010.

VMC has been a FINRA member since 1977. Its principal place of business is in Malvern, Pennsylvania, and it has approximately 9,600 registered representatives operating out of approximately 175 registered branch locations.