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FinCEN Fines Oppenheimer & Co. Inc. $20 Million for Continued Anti-Money Laundering Shortfalls
Suspicious Penny Stock trading and Pump-and-Dump Schemes Not Flagged
and Foreign Correspondent Customer Allowed to Conduct Prohibited Activity
....
From 2008 through May 2014, Oppenheimer conducted business without establishing and
implementing adequate policies, procedures, and internal controls reasonably designed to detect
and report suspicious activity. FinCEN identified 16 customers who engaged in patterns of
suspicious trading through branch offices in five states. All the suspicious activity involved
penny stocks, which typically are low-priced, thinly traded, and highly speculative securities that
can be vulnerable to manipulation by stock promoters and “pump-and-dump” schemes.
Oppenheimer failed to report patterns of activity in which customers deposited large blocks of
unregistered or illiquid penny stocks, moved large volumes of penny stocks among accounts with
no apparent purpose, or immediately liquidated those securities and wired the proceeds out of the
account.
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