FINRA slapped a subsidiary of National Bank of Canada with a $20,000 fine for failing to review the incoming and outgoing email correspondence of its registered reps.
According to a FINRA filing this week, National Bank of Canada Financial Inc. neglected to implement a supervisory system to ensure compliance with rules that firms develop written procedures for the review of incoming and outgoing written and electronic communication with the public relating to their investment banking or securities business.
National Bank of Canada Financial operates out of one branch in New York and two branches in Canada and employs approximately 50 registered representatives, FINRA said.
From April 30, 2013 to July 23, 2013, the firm allegedly failed to include emails from three domains ("nbc.ca," "bnc.ca," and "Bloomberg.net") and all Blackberry pin-to-pin communications in the firm's queue for electronic communications to be reviewed. As a result, some 500,000 electronic communications of the firm's reps were not reviewed, FINRA claims.
In addition, FINRA found the firm's written supervisory procedures were inadequate as they did not address how the firm would review electronic communications in foreign languages, among other failings. The firm did not use any French language lexicon terms to identify emails for supervisory review, even though certain of the firm's business communications were conducted with French-speaking employees and customers.
Marie-Pierre Jodoin, manager of public affairs for National Bank of Canada, declined to comment on the matter. In its settlement with FINRA, the firm neither admitted nor denied the charges but consented to an entry of FINRA's finding.