FINRA Sanctions Firm, CEO for Reg BI Violations
What You Need to Know
CEO Yong Soo Kim, who is also the firm’s chief compliance officer, was suspended for two months.
The Financial Industry Regulatory Authority has fined Kayan Securities and its CEO and chief compliance officer, Yong Soo Kim, for violating two prongs of Regulation Best Interest.
Kim was also suspended for two months for the Reg BI violations and Kayan ordered to pay $50,000 in partial restitution for failing to supervise a rep’s unauthorized and excessive trading.
According to FINRA’s order, from January 2018 through at least April 2021, Kayan and Kim failed to establish, maintain and enforce a supervisory system, including written supervisory procedures, reasonably designed to achieve compliance with the suitability requirements of FINRA Rule 2111 and the care obligation of Reg BI as they pertain to excessive trading, violating FINRA Rules 3110 and 2010.
As of June 30, 2020, Kayan also violated Reg BI’s compliance obligation by not establishing, maintaining, and enforcing WSPs reasonably designed to achieve compliance with Reg BI, according to the order.
In January 2020, a customer won a FINRA arbitration award against Kim, “who was found jointly and severally liable for the customer’s losses, and ordered to pay $12,757 after the customer made allegations of breach of contract, errors/charges, negligence, breach of fiduciary duty, churning, lack of suitability, unauthorized trading, and indemnification,” the order states.
