Brokerage Firm Review: RBC Capital Markets, LLC

RBC Capital Markets, LLC (“RBC Capital Markets”) (CRD#31194) has many different complaints filed by FINRA (Financial Industry Regulatory Authority), state regulatory organizations, and investors such as yourself. At the Law Offices of Robert Wayne Pearce, we have investigated RBC Capital Markets, its regulatory and customer complaints, and have also represented investors with claims of fraud, negligence, and breach of fiduciary duty against this organization and its financial advisors.

If you believe you have a claim against RBC Capital Markets, you should strongly consider hiring an investment fraud lawyer. You should not wait until it’s too late to file a claim. The Law Offices of Robert Wayne Pearce, P.A., offers free consultations. Give us a call at 800-732-2889. Let’s discuss your case and see what we can do to help you get the compensation you need and deserve.

Can I Sue RBC Capital Markets?

If you’ve lost money caused by RBC Capital Markets and/or its employees’ misconduct then the answer is, YES, you can sue RBC Capital Markets, but the odds are you signed away your right to sue in court and agreed to resolve your dispute in a FINRA arbitration proceeding. Attorney Robert Wayne Pearce has over 40 years of personal experience in FINRA arbitration proceedings and knows very well how you can not only sue RBC Capital Markets in FINRA arbitration proceedings but WIN that arbitration. The easiest way to know if you have a viable case against RBC Capital Markets is to call Attorney Pearce at our office at 800-732-2889.

Investment Losses? We Can Help

Discuss your legal options with an attorney at The Law Offices of Robert Wayne Pearce, P.A.

Get A Free Consultation

or, give us a ring at (800) 732-2889.

What is RBC Capital Markets?

RBC Capital Markets (CRD#31194) is a registered broker-dealer. It operates as a full-service independent broker-dealer, providing a range of financial products and services to individual investors and financial advisors.

As a registered broker-dealer, RBC Capital Markets is subject to regulations and oversight by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). It is required to comply with industry standards and regulations to ensure the protection of its clients’ interests.

A failure to comply with industry standards by either its brokers or the firm itself can result in disciplinary actions, fines, or other penalties imposed by regulatory authorities.

RBC Capital Markets Has Many Different Regulatory Problems 

RBC Capital Markets’rapid growth has not been without consequences. There have been approximately 358 state and self-regulatory body disclosure events; that is, final and formal proceedings initiated by a regulatory authority (e.g., a state or federal securities agency like the U.S. Securities and Exchange Commission (SEC) or self-regulatory body like the Financial Industry Regulatory Authority (FINRA) and the North American Securities Administrators Association (NASAA) for a violation(s) of investment-related rules or regulations. In addition, there have been over one hundred of customer complaints filed against RBC Capital Marketsfor misconduct by its securities sales and investment advisory representatives that are not reported by the firm on its Central Depository Record. 

We have reported and written about these regulatory problems and customer complaints over many years. RBC Capital Markets is a repeat offender: there are over 358 FINRA-reported proceedings citing the firm with one form of supervisory lapses or another.

A Brief Overview of Some of the Regulatory Problems RBC Capital Markets Has Faced Over the Years*

RBC Capital Markets has been repeatedly censured, warned, and fined multi-millions of dollars for its own misconduct and failure to supervise its army of financial advisors. * A few of the notable FINRA Sanctions for its Supervisory Failures are below:

FINRA Censures and Fines RBC Capital Markets for Overreporting Short Interest Positions

Brief Overview: Without admitting or denying the findings, RBC Capital Markets consented to the sanctions and to the entry of FINRA findings that it filed short interest reports that overreported the number of shares associated with short interest positions. FINRA said the firm submitted short interest reports to it that erroneously included short positions in accounts resulting from repurchase and pledge transactions and securities lending conducted by the firm or its affiliates, and syndicate activity of correspondent firms for which it clears securities transactions. Since these short positions did not result from “short sales” as defined by the applicable rule and were not transactions that were marked long due to the firm’s or the customer’s net long position at the time of the transaction, they were not reportable under FINRA rules. As a result, the firm was censured and fined $250,000.

NASDAQ Philadelphia Stock Exchange Censures and Fines RBC Capital Markets for Inputting Incorrect Codes on Equity Orders

Brief Overview: The Nasdaq Philadelphia Stock Exchange enforcement department reviewed RBC Capital’s compliance with PHLX rules requiring members to input the correct capacity codes on equity orders entered into exchange systems. The entry of inaccurate capacity codes causes the audit trail to be inaccurate capacity codes causes the audit trail to be inaccurate. The staff determined that the firm inputted the incorrect capacity code on hundreds of millions of equity orders it entered into multiple exchanges, including over 11 million orders it input into the PSX system with incorrect capacity codes. As a result, the firm was censured and fined.

NASDAQ Stock Market Censures and Fines RBC Capital Markets for Inputting Incorrect Codes on Equity Orders

Brief Overview: The NASDAQ Enforcement Department reviewed the firm’s compliance with NASDAQ rules requiring members to input the correct capacity codes on equity orders entered into exchange systems. As a result of its review, the Department determined that the firm inputted the incorrect capacity code on hundreds of millions of equity orders it entered into multiple exchanges, including over 40 million orders it inputted into the NASDAQ system with incorrect capacity codes. As a result, the firm was censured and fined $180,000.

NYSE Censures and Fines RBC Capital Markets for Incorrectly Marking Orders

Brief Overview: Without admitting or denying the findings, RBC Capital Markets consented to the sanctions and to the entry of FINRA findings that it violated NYSE rules by submitting over 150,000 principal orders incorrectly marked as agency orders and by failing to have a reasonably designed supervisory system to comply with its capacity code obligations. In its investigation, the NYSE found the firm incorrectly entered over 150,000 orders into the NYSE with the “agency” capacity code when the orders should have been marked with the “principal” capacity code due to a coding error impacting a firm trading platform. The NYSE further found the firm did not have a supervisory system or written supervisory procedures in place that were reasonably designed to confirm that client orders were coded with accurate capacities. As a result, the firm was censured and fined.

FINRA Censures and Fines RBC Capital Markets for Failure to Meet Suitability Obligations in Connection with Preferred Stock Trading

Brief Overview: Without admitting or denying the findings, RBC Capital Markets consented to the sanctions and to the entry of FINRA findings that it failed to establish and maintain a supervisory system reasonably designed to achieve compliance with its suitability obligations in connection with syndicate preferred stock. FINRA said while the firm’s procedures called for supervisors to closely examine representatives’ short-term trading of preferred stocks, the firm’s electronic surveillance of short-term trading in preferred stock failed to monitor that activity. Although the surveillance system had certain alerts that specifically monitored for short-term trading in other products, such as closed-end funds, it did not have any alerts that specifically monitored for short-term trading in preferred stock. As a result, the firm was censure and fined $300,000.

Why Does RBC Capital Markets Have So Many Regulatory Problems And Customer Complaints?

Sadly, many large brokerages like RBC Capital Markets still lack effective compliance and supervision, which is critical for investor protection and capital market stability and integrity. Compliance challenges continue to grow every day and it’s difficult for even the largest well capitalized firms to keep up with them. This can be attributed to many factors.

Large brokerage firms are merging and consolidating creating larger, more diversified, and more dispersed organizations. The number of branch offices of broker-dealers like RBC Capital Markets has been steadily escalating and firms are becoming more geographically diverse. The distance from the home office and the large number of offices can offer challenges to maintaining uniform, consistent, and complete compliance coverage.

Products offered by large wire houses like RBC Capital Markets as well as their customer base are also becoming more diverse and more complex. When a firm sells products, its registered representatives are required to fully understand all the complexities and be able to convey them in an understandable way to the firm’s customers. This requires a devotion of resources to education. The increased diversity of activities in which the larger brokerage firms engage raises more potential conflicts of interest which are ignored. More and more confidential trade, financial and other information is available to brokerages and their employees and being misused.

As financial markets and products become more complex and as conflicts arise, the extra attention and resources that are necessary to promote compliance with the law through additional education of advisors, improved technology in compliance departments, and adequate staffing of branch level supervisors is sacrificed for the bottom line. The sad truth is many of the biggest broker dealers like RBC Capital Markets have probably chosen profits for their shareholders over protection for their customers.

Did RBC Capital Markets Advisor Misconduct Cause You Investment Losses?

When financial advisor misconduct has caused you to lose substantial value to your investment accounts, you have the right to seek reimbursement from the responsible parties. RBC Capital Markets is responsible like any employer for its financial advisors acts and omissions. In addition, it has an independent duty to supervise its stockbrokers and investment advisors. These cases can be extremely complex, and so having the support of a reputable attorney who is experienced in recovering investment losses for investors is key to your success. Many customers make the mistake of contacting RBC Capital Markets without representation with an attorney about their complaints and have their complaints denied.

Related Read: Can You Sue Your Brokerage Firm?

Investment Losses? We Can Help

Discuss your legal options with an attorney at The Law Offices of Robert Wayne Pearce, P.A.

Get A Free Consultation

or, give us a ring at (800) 732-2889.

Consult With An Attorney Who Recovers Investment Losses Caused By RBC Capital Markets Today!

The investment loss attorneys at The Law Offices of Robert Wayne Pearce, P.A., have helped countless investors over the last 40 years recover the losses from their investment accounts that were caused by broker negligence or misconduct. The firm has extensive experience with RBC Capital Markets cases, and Attorney Pearce is committed to seeing that those responsible for the losses you have suffered are held fully accountable.

Give us a call at 800-732-2889. Let’s discuss your case and see what we can do to help you get the compensation you need and deserve.

Robert Wayne Pearce

Robert Wayne Pearce of The Law Offices of Robert Wayne Pearce, P.A. has been a trial attorney for more than 40 years and has helped recover over $170 million dollars for his clients. During that time, he developed a well-respected and highly accomplished legal career representing investors and brokers in disputes with one another and the government and industry regulators. To speak with Attorney Pearce, call (800) 732-2889 or Contact Us online for a FREE INITIAL CONSULTATION with Attorney Pearce about your case.

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