Interactive brokers pay $ 38 million in fines to U.S. regulators

WASHINGTON / NEW YORK (Reuters) – Interactive Brokers LLC will pay $ 38 million in fines to settle costs that failed to flag suspicious activity and comply with anti-money laundering measures, U.S. regulators said on Monday.

The broker-dealer agreed to pay $ 15 million to the Financial Industry Regulatory Authority (FINRA) for widespread misconduct against money laundering that lasted more than five years, FINRA said. Interactive brokers saw “dramatic growth” in their business from January 2013 to September 2018, became one of the largest electronic broker dealers in the United States, but failed to clear the necessary resources to properly control hundreds of millions of dollars in wire transport reasonably investigate suspicious activity, according to FINRA.

As part of the deal, the company will need to implement recommendations from a third-party consultant to fix the issues.

Interactive brokers will also pay $ 11.5 million to resolve parallel charges with the U.S. Securities and Exchange Commission (SEC) over repeated failures to file reports of suspicious activity for U.S. securities executed for clients. the agency said in a statement. The company did not allow or deny the SEC’s findings, it said.

Interactive brokers pay another $ 11.5 million fine to the Commodity Futures Trading Commission for failing to be a registered futures commission trader to monitor the treatment of the accounts’ employees quickly. The company carried out orders for a Harvard graduate who had previously been accused of fraud in a Ponzi scheme, the CFTC said.

The company will again pay $ 706,214 in wear and tear for the CFTC charges.

“We have fully cooperated with our regulators in these investigations, and the key steps we have taken to expand and improve our program have been taken into account in the current settlements,” said a spokesman for Interactive Brokers in an email.