WR Securities, LLC dba Wolfe Research Securities (CRD #151850, New York, New York)

March 23, 2022 – An AWC was issued in which the firm was censured and fined $100,000. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it overstated its advertised daily trading volume on a private subscription-based provider of market data. The findings stated that the firm’s overstatements resulted from a flaw in the advertising logic of its third-party order management system (OMS). The firm relied on its OMS to automatically report its executed order flow to the private market data provider on the firm’s behalf. In certain circumstances, when calculating trading volume for advertising purposes, the firm’s OMS incorrectly summed multiple fills for the same order, resulting in significant over-advertising of trading volume. As a result of this flaw persisting for more than a three-year period, the firm overstated its advertised trading volume through the private market data provider by 90,446,177 shares. The findings also stated that the firm’s supervisory system, including its WSPs, was not reasonably designed to achieve compliance with FINRA Rule 5210, which governs the accuracy of advertised trading volume. The firm did not have any procedures relating to how its trading volume should be collected and submitted to market data providers, or to how the firm should monitor its advertised trading volumes to ensure they were accurate. Likewise, the firm did not have any supervisory system to ensure the accuracy of its advertised trading volumes. The firm’s OMS generated a daily list of securities traded, total shares traded, and the number of shares advertised via the private market data provider. However, the firm failed to review the report for the purpose of identifying instances of over-advertisement, and therefore, failed to identify the instances that it overstated its advertised trading volume. (FINRA Case #2020067770401)