Mundial Financial Group to Pay Fine in FINRA Settlement

Mundial Financial Group, LLC has agreed to pay a $100,000 fine as part of a settlement with the Financial Industry Regulatory Authority (FINRA) following multiple regulatory violations.

FINRA found that from January 2018 through at least January 2024, Mundial’s indirect owner acted as a principal and registered representative without registering as a General Securities Principal or General Securities Representative. The owner solicited most of the firm’s customers, managed customer relationships, directed aspects of the securities business, and controlled the firm’s finances. He also made key operational personnel decisions, including hiring and determining salaries. Despite knowing the owner was unregistered, Mundial allowed him to actively manage the firm’s securities activities.

Mundial Financial Group to Pay Fine in FINRA Settlement

As a result, FINRA determined that Mundial violated FINRA Rule 1210, NASD Rules 1021 and 1031, and FINRA Rule 2010.

FINRA also found deficiencies in Mundial’s customer identification and anti-money laundering procedures. From September 2019 to the present, the firm could not reliably verify the identities of its customers or develop risk profiles because its Customer Identification Program (CIP) was not tailored to its primarily foreign customer base. Many of the firm’s roughly 35 customers, mostly domiciled outside the U.S., never interacted with a registered representative, and the firm approved electronically submitted account applications despite discrepancies in income, net worth, and address information.

Additionally, Mundial failed to implement an effective anti-money laundering (AML) program. While the firm maintained written procedures listing red flags for suspicious transactions, it did not outline how to detect, investigate, or report these transactions. The firm relied solely on manual daily trade and cashiering report reviews, which did not identify patterns of potentially suspicious transactions or insider trading risks. During the relevant period, the firm ignored or inadequately monitored several red flags, including unusually large deposits, simultaneous account openings referred by the same individual, and potential insider trading activities.

As a result, FINRA concluded that Mundial violated FINRA Rules 3310(a), 3310(b), 3310(f)(i), 3310(f)(ii), and 2010.

In addition to the $100,000 fine, Mundial agreed to a censure and an undertaking to improve compliance practices.

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