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The
discount brokerage unit of TD Ameritrade Holding also agreed to
contribute another $100,000 to investor education efforts in
Texas.
The violations involved TD Ameritrade's institutional business,
in which independent registered investment advisers (RIAs)
arrange for their clients to buy and sell securities through TD
Ameritrade and hold their assets with the company, according to
the Texas State Securities Board.
In an order signed Monday and released Tuesday, Texas Securities
Commissioner John Morgan said his staff found "many instances"
where customers of RIAs from early 2011 through August 2014 were
not notified of third-party wire transfers from their accounts
because TD Ameritrade relied on manual processing.
A "majority" of disbursement notices reviewed by the regulator
were filed promptly, TD Ameritrade spokeswoman Kim Hillyer wrote
in an e-mail, "but because we did not issue a notice in every
instance, or were unable to locate some of the requested
notices, we agreed to settle this matter."
She declined to discuss whether other state or federal
regulators were looking into the company's procedures.
TD Ameritrade used an automated electronic process for
disbursement notices in its retail business, where customers
work directly with the firm and was aware of the problem in its
other business, the Texas regulator said. However, it did not
start a project to automate disbursement notices there until
July 2013 or fully deploy it until August 2014.
State and federal regulators in recent years have been stepping
up their investigation of wire transfers, in part because of an
increase in computer security breaches.
(Reporting By Jed Horowitz; Editing by Bernard Orr)
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