Top 10 Trends in Disciplinary Actions for 2025

Regulatory enforcement activity in the first half of 2025 has uncovered recurring compliance failures across the securities industry. From supervisory lapses to disclosure violations, these disciplinary actions serve as both a warning and a guide for firms and registered representatives to avoid similar violations.

"Analyzing trends in disciplinary actions allows firms to pinpoint specific areas to emphasize in their annual training programs," said Julie Mendel, SILA Fellow, CDEI, and WebCE's Product Management Director of Securities Products. "At WebCE, we use this information to develop training materials that assist firms and their representatives in maintaining compliance and avoiding sanctions."

Here are the top 10 trends in disciplinary actions taken so far this year: 

1. Failure to Provide Information: Failure to respond to FINRA’s requests for information. 

2. Failure to Comply with Arbitration or Settlement Awards: Several individuals were suspended for not complying with arbitration awards or related settlements. 

3. Unsuitable Recommendations: Unsuitable recommendations for investment profiles and/or violations of Reg BI by not acting in the customer's best interest. 

4. Exercising Discretion Without Authorization: Executing trades in customer accounts without written authorization or without the firm approving the accounts as discretionary. 

5. Failure to Disclose Information on Form U4: Failure to disclose information (like felony charges, judgments, liens, bankruptcies, etc.) on their Form U4. 

6. Misuse of Firm Funds: Submitting expenses that did not comply with company policy. 

7. Maintaining Incomplete or Inaccurate Books and Records: Representatives caused their firms to maintain incomplete or inaccurate records by using personal email accounts or failing to report other required information. 

8. Forgery and Backdating Documents: Forging customer signatures and backdating documents, causing the firm to have inaccurate records and violations of company policies. 

9. Spoofing in U.S. Treasury Securities: Engaging in manipulative trading practices (like spoofing), involving placing large orders with the intent to cancel them before execution. 

10. Failure to Supervise or Implement Adequate Compliance Programs (Firm violations): Failure to establish and implement reasonable AML programs, supervise technology systems, or retain social media communications. 

These violations illustrate that even well-established firms can fall short in familiar areas. While written procedures and controls are essential, training remains one of the most effective tools for preventing repeat violations and strengthening firm-wide awareness.

With FINRA’s Firm Element requirement in place, firms have a built-in opportunity each year to address current risks through targeted education. WebCE’s Firm Element Catalog includes timely courses aligned with today’s enforcement priorities, while our FINRA Training offerings support broader compliance topics through the official FINRA E-Learning Library. For firms seeking tailored content or system-wide integration, WebCE also offers custom compliance solutions designed to meet unique business needs.

Education alone won’t eliminate risk, but, when paired with strong internal systems and leadership support, it can help firms stay ahead of enforcement trends and reinforce a culture of compliance.