FINRA fines Guggenheim Securities fined $800,000
NEW YORK -- The Financial Industry Regulatory Authority has fined financial services firm Guggenheim Securities LLC $800,000 for failing to supervise two former traders who tried to hide a 2008 trading loss.
FINRA said Thursday that Alexander Rekeda, who used to head Guggenheim's collateralized debt obligation desk, was suspended for a year from the securities industry and fined $50,000. Timothy Day, a trader on the desk, was suspended from the securities industry for four months and fined $20,000.
"The traders deceived their customer and supported their scheme through the use of inaccurate books and records, all of which went undetected by the firm," FINRA Vice President and Chief of Enforcement Brad Bennett said in a statement.
Guggenheim Securities, Rekeda and Day neither admitted nor denied the charges but consented to FINRA's findings. Aside from the fine, privately held Guggenheim has agreed to hire an independent consultant to review and make recommendations concerning its supervising procedures.
"Today's settlement relates to sales practices by two former employees of Guggenheim Securities. We have cooperated fully with FINRA throughout its investigation, and we are pleased to put this matter behind us," said Guggenheim spokesman Felipe Ucros.