Barclays hammered with $1.25M fine over fingerprinting lapses

investmentnews.com:

Finra has censured and fined Barclays Capital more than a million dollars for reported longstanding lapses in fingerprinting and background screening procedures for non-registered employees.

The violations, which date back to at least 2013, involved both US-based and foreign employees who were required to be fingerprinted under federal securities regulations.

In an AWC letter issued Thursday, Finra said the brokerage firm failed to properly fingerprint 2,317 non-registered associated persons working in foreign locations and delayed fingerprinting 1,663 US-based employees from January 2013 to September 2023.

“Federal securities laws mandate that broker-dealers fingerprint most associated persons to identify potential statutory disqualifications, such as criminal or regulatory violations,” Finra noted in its settlement.

According to Finra, Barclays isn’t able to determine how many of its former associates abroad should have been fingerprinted and subject to screening as they’ve cut ties with the firm. Those same questions will remain unanswered for 1,414 of Barclays’ ex-employees in the US.

The regulator also took the firm to task over its written supervisory procedures, which contributed to the widespread oversight as it neglected to include guidelines for fingerprinting individuals based outside the US.

Because of those shortfalls, Finra found Barclays in violation of several rules, including Section 17(f)(2) of the Exchange Act, which requires firms to maintain comprehensive fingerprinting records, and Finra Rule 2010.

Beyond these infractions, Barclays failed to retain fingerprint records for an additional 534 employees between 2004 and 2016, in breach of Section 17(a) of the Exchange Act and related Finra rules.

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