Wells Fargo Securities Fined $200,000 by FINRA for Overstating Trade Volume

The Financial Industry Regulatory Authority (FINRA) has fined Wells Fargo Securities, the investment banking and capital markets business unit of Wells Fargo, by $200,000, primarily for overstating its advertising trading volume on social media campaigns.

In addition, the company's violations include a failure to establish and maintain a sound supervisory system. Wells Fargo has agreed to pay the penalty and settled the charges with the regulator.

FINRA issued a Letter of Waiver, Acceptance, and Consent (AWC) on Thursday detailing Wells Fargo's regulatory violations between December 2016 and June 2018. Its configured system automatically advertised daily trading volumes for numerous securities through two third-party service providers. However, two misconfigurations of Wells Fargo occurred during the period and resulted in the trading volume overstatement by nearly 148,000,000 shares in more than 10,000 instances.

"Additionally, the firm failed to perform any testing of options trades or multi-leg trades to ensure that the non-equity components were properly excluded from advertisement as · intended, nor did the firm test to ensure that such trades were otherwise advertised correctly," stated FINRA in the AWC letter.

This is the second monetary penalty that Wells Fargo has paid this week. On Tuesday, the Consumer Financial Protection Bureau slapped the bank with a $1.7 billion fine​ for charging illegal fees and interest on auto loans and mortgages, as well as incorrectly applying overdraft fees against savings and checking accounts.