Posted On: 05/19/2014 10:24:39 PM
Post# of 807
Re: Kazorchian #127
Patrick Byrne called this years ago yet the regulators are just getting round to it:
In December 2009, Penson’s Compliance Department conducted an NASD
Rule 3012 internal audit of the Rule 204T/204 close-out procedures for Buy Ins, which had
been in place at Penson from October 2008 forward. The audit uncovered severe
compliance deficiencies – Penson’s compliance personnel sampled 113 CNS failures to
deliver resulting from both long sales and short sales and found that Buy Ins’ procedures
resulted in Rule 204(a) violations for 112 out of the 113 securities sampled (99% failure
7
rate). Delaney understood this NASD Rule 3012 audit had revealed massive and profound
failures relating to Buy Ins’s Rule 204T(a)/204(a) procedures that were anomalous during
his tenure as CCO.
In December 2009, Penson’s Compliance Department conducted an NASD
Rule 3012 internal audit of the Rule 204T/204 close-out procedures for Buy Ins, which had
been in place at Penson from October 2008 forward. The audit uncovered severe
compliance deficiencies – Penson’s compliance personnel sampled 113 CNS failures to
deliver resulting from both long sales and short sales and found that Buy Ins’ procedures
resulted in Rule 204(a) violations for 112 out of the 113 securities sampled (99% failure
7
rate). Delaney understood this NASD Rule 3012 audit had revealed massive and profound
failures relating to Buy Ins’s Rule 204T(a)/204(a) procedures that were anomalous during
his tenure as CCO.
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