Tradition Securities and Derivatives

Kurta Law is investigating allegations of misconduct by brokers associated with Tradition Securities and Derivatives (CRD#: 28269). Investors should know that this firm has been fined by the SEC and FINRA. Tradition Securities and Derivatives is a brokerage firm with headquarters in New York, New York.

Tradition Securities and Derivatives has operated under 17 names, including:

• Bridgeview Execution Services
• TSF
• Tradition Securities and Futures
• Nexus America
• Nautilus Securities
• Tradition Asiel Securities
• Tradition (Government Securities)
• TFSD
• TFS Derivatives
• Nova Execution Services

Fees and Conflicts of Interest

Tradition Securities and Derivatives discloses its conflicts of interest and how it earns compensation in its Customer Relationship Summary (Form CRS):

• You will be charged commissions or markups/markdowns on transactions. This gives the firm an incentive to encourage frequent trading.
• Some investment products, like mutual funds and variable annuities, charge their own added fees.
• Tradition Securities and Derivatives does not provide investment recommendations or investment advice, and will not evaluate whether you will suffer losses on a transaction.
• Tradition Securities and Derivatives sends equity orders to exchanges, Electronic Communication Networks, or other broker-dealers for order flow, and the firm may receive payments for this.

Broker-Dealer Services

Tradition Securities and Derivatives allows investors to trade in stocks, bonds, and products such as mutual funds and variable annuities. However, investors should keep in mind that these products can feature a high level of risk and expensive fees.

Regulatory Actions

Investors should be aware that Tradition Securities and Derivatives has faced fines by FINRA and the SEC. The firm discloses these and other regulatory actions on its detailed BrokerCheck page.

FINRA Fine

On November 6, 2023, Tradition Securities and Derivatives consented to the entry of findings that it allegedly failed to record transmission times on order tickets from January to September 2020, and failed to include the correct exchange of execution on order tickets from April 13-17, 2020.

A Letter of Acceptance, Waiver & Consent (AWC) further alleged that Tradition Securities and Derivatives failed to establish supervisory procedures reasonably designed to ensure the immediate receipt of post-trade execution reports by surveillance personnel.

The firm consented to a censure, $140,000 fine, and an undertaking to remediate the supervisory issues alleged in the AWC. You can read the AWC here.

SEC Fine

On September 28, 2021, the Securities and Exchange Commission entered cease-and-desist proceedings against Tradition Securities and Derivatives, alleging that the firm violated Regulation SHO of the Securities Exchange Act of 1934.

The SEC alleged that, from October 2016 through May 2019, the firm allegedly failed to satisfy order marking and locate requirements in connection with over 1,000 short sales in client accounts and approximately 50 short sales in its principal accounts.

The firm allegedly executed these transactions as part of its merger arbitrage trading practices, a strategy that involves selling short shares of an acquiring company in a merger while purchasing shares in the acquisition target.

The SEC censured Tradition Securities and Derivatives and ordered it to cease and desist from Rules 200(g)(1) and 203(b)(1) of Regulation SHO of the Securities Exchange Act. Tradition Securities and Derivatives was also ordered to pay a fine of $841,627, an additional disgorgement of $841,627, and prejudgment interest of $104,205.

Anti-Money Laundering Program Allegations

An AWC filed on December 18, 2018, alleged that Tradition Securities and Derivatives did not have an adequate anti-money laundering (AML) compliance program tailored to its foreign bond business when it facilitated the sale of Venezuelan and Argentinian bonds between August 2013 and August 2016.

The AWC further alleged that the firm failed to conduct due diligence on the accounts of foreign financial institutions, including the money laundering risks they posed. The firm allegedly also failed to periodically review account activity to verify the type and purpose of bond activity in these accounts against previously obtained information.

Tradition Securities and Derivatives consented to a censure, fine of $100,000, and to undertake a certification that its policies and procedures are reasonably designed to comply with FINRA Rule 3310 and the Bank Secrecy Act. You can access the AWC here.

Alleged MSRB Violations

On November 10, 2016, an AWC alleged that the Municipal Securities Rulemaking Board found that Tradition Securities and Derivatives violated MSRB Rule G-14 during three review periods in 2014.

These violations allegedly involved failure to report information concerning transactions effected in municipal securities to the Real-Time Transaction Reporting System (RTRS) and improper reports of municipal securities transfers not reportable to the RTRS.

Tradition Securities and Derivatives consented to a censure and fine of $52,500. You can read the full AWC here.

How Can Investors Recover Lost Funds from a Brokerage Firm?

If you have concerns about your broker’s conduct, you may be able to recoup your losses by pursuing FINRA arbitration. Many brokerage firms require investors to resolve disputes through FINRA arbitration, and a securities attorney can help.

Kurta Law Can Help

Investors who lost money working with a Tradition Securities and Derivatives broker should reach out to an investment fraud lawyer for help. Our attorneys offer free case evaluations and do not charge a fee unless we win your case. Call (877) 600-0098 or email info@kurtalawfirm.com.