Finra bars former head of B-D over money-laundering lapses

Donna Jean Flemming failed to implement adequate AML program, regulator says

Jun 12, 2019 @ 1:55 pm

By InvestmentNews

The Financial Industry Regulatory Authority Inc. has barred Donna Jean Flemming, the former president and chief executive officer of Spencer Edwards Inc. for failing to implement an adequate anti-money laundering program and for falsifying documents.

(More:SEC, Finra nab two firms for AML violations)

The firm's membership in Finra was cancelled on Feb. 1. In addition to her role as head of the firm, Ms. Flemming served as chief compliance officer and its anti-money laundering compliance officer from 2012 until mid-2017. The firm was based in Centennial, Colo.

According to a Finra letter of acceptance, waiver and consent, Ms. Flemming "completely abdicated" her AML responsibilities from September 2013 to August 2015, when her firm derived more than 80% of its revenue from accepting customers' deposits of microcap securities and liquidating the shares. Finra said that Ms. Flemming did not monitor whether customers' deposits and liquidations of microcap securities posed red flags of potentially suspicious activity.

"In fact, she did not participate in the firm's process for reviewing and accepting stock deposits, instead delegating that authority to an unregistered person, the firm's outside lawyer, whom she did not monitor, audit or otherwise supervise. Moreover, even when the outside lawyer identified potentially suspicious activity during reviews of proposed stock deposits, "Ms. Flemming did not investigate, did not track customers' activity for patterns of suspicious activity, and did not determine whether the firm needed to file suspicious activity reports."

(More:UBS hit with $15 million in fines, penalties for AML problems)

In addition, Ms. Flemming did not maintain adequate AML records, Finra said.


What do you think?

View comments

Most watched


Young advisers envision a radically different business in five years

Fintech and sustainable investing are two factors being watched closely by some of the 2019 class of InvestmentNews' 40 Under 40.


Young professionals see lots of opportunity to reinvent the advice experience

Members of the 2019 InvestmentNews class of 40 Under 40 have strategies to overcome the challenges of being young in a mature industry.

Latest news & opinion

New Jersey fiduciary rule: Pressure leads to public hearing, comment deadline extension

Industry push results in chance to air grievances on July 17 and another month to present objections.

InvestmentNews' 2019 class of 40 Under 40

Our 40 Under 40 project, now in its sixth year, highlights young talent in the financial advice industry. These individuals illustrate the tremendous potential of those coming up in the profession. These stories will surprise, entertain, educate and inspire.

Galvin to propose fiduciary rule for Massachusetts brokers

The secretary of the commonwealth is proposing a fiduciary standard in response to an SEC investment-advice rule he views as too weak.

Summer reading recommendations from financial advisers

Here are some books that will keep you informed and entertained during summer's downtime

4 strategies for Roth conversions

There's never been a better time to do a Roth conversion, and here are several ways to go about it.


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting It'll help us continue to serve you.

Yes, show me how to whitelist

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print