meta_id 3402707

On May 20, 2026, the Financial Industry Regulatory Authority (FINRA) announced enforcement actions against two member firms for anti-money laundering (AML) and supervisory violations involving low-priced securities transactions. FINRA fined Pictet Overseas Inc. $610,000 and Blue Ocean ATS $550,000, totalling more than $1.1 million in penalties. Pictet Overseas executed approximately $300 million in low-priced securities transactions involving more than 150 million shares between February 2022 and March 2023, with more than 70 percent occurring through an omnibus account held by a foreign financial institution affiliate. Despite receiving an alert from another regulator in June 2021 regarding AML program deficiencies, Pictet failed to implement timely corrective action. The firm did not develop an AML compliance program reasonably designed to detect suspicious transactions in low-priced securities from September 2021 to February 2025. Pictet relied on manually compiled daily reports until February 2023, which could not effectively identify suspicious activity patterns. The firm failed to detect red flags where customers' trading represented significant portions of daily market volume, in some cases exceeding 20 percent on individual days. Additionally, Pictet did not implement adequate due diligence procedures for foreign financial institution correspondent accounts and failed to reasonably supervise compliance with Section 5 of the Securities Act of 1933. Blue Ocean ATS handled 95 percent of all overnight trading volume since its inception, including substantial low-priced securities volume. Despite rapid business growth and known risks associated with low-priced securities, Blue Ocean failed to develop an AML compliance program reasonably tailored to its business risks since at least January 2023. The firm's monitoring consisted primarily of manual reviews by a single employee and conducted no surveillance for spoofing, layering, or other manipulative order entry patterns. Both firms consented to FINRA's findings without admitting or denying charges. FINRA ordered Blue Ocean to certify remediation of its AML compliance program deficiencies.