Fenix Securities LLC has agreed to pay a fine of $250,000 as a part of a settlement with the Financial Industry Regulatory Authority (FINRA).

From December 2016 through April 2024, the firm permitted foreign individuals to conduct a securities business using the firm’s systems when they were not registered with FINRA in any capacity.

At all relevant times, the firm’s primary business was agency trading of listed equities and foreign government debt instruments for predominately retail customers, the majority of whom were located in Latin America.

Between December 2016 and April 2024, the firm permitted 47 foreign persons to access the firm’s trading platform and place trades for customers when they were not registered with FINRA in any capacity.

More specifically, the firm used nonregistered foreign individuals to refer non-US customer accounts to the firm. These nonregistered foreign individuals accessed the firm’s trading platform and used that access to place trades in firm customer accounts.

The firm issued these individuals representative codes that were used to effect transactions in the referred accounts.

As a result, the firm violated FINRA Rules 1210 and 2010 and NASO Rule 1031.

From March 2018 through September 2018, the firm paid transaction-based compensation to nonregistered, foreign individuals without disclosing in trade confirmations that a finder’s fee was paid. As a result, the firm violated FINRA Rules 2040 and 2010.

From December 2016 through April 2024, the firm’s supervisory system, including written supervisory procedures (WSPs), was not reasonably designed to achieve compliance with FINRA registration requirements (FINRA Rule 1210 and NASO Rule 1031) or with FINRA Rule 2040. As a result, the firm violated FINRA Rules 3110 and 2010.

From July 2016 through May 2022, the firm failed to establish and implement an anti-money laundering (AML) program that was reasonably designed to detect and cause the reporting of suspicious activity in violation ofFINRA Rules 3310(a) and 2010. From May 2018 through May 2022, the firm’s AML program failed to include appropriate risk- based procedures for conducting ongoing customer due diligence in violation ofFINRA Rules 3310(t) and 2010.

On top of the $250,000 fine, the firm has agreed to a censure and an undertaking that a member of its senior management who is a registered principal of the firm will certify in writing that the firm has remediated the issues.