Securities Lawyers Blog
Financial advisor complaints, broker complaints, and FINRA customer disputes are public on BrokerCheck, and a broker’s regulatory history is often the first thing an investor checks after an unexpected loss. The investor attorneys at Gana Weinstein LLP help customers of firms such as Webull Financial LLC understand what a financial advisor’s disciplinary history means and whether their own losses support a claim against the broker or the brokerage firm.
Webull Financial is an online broker-dealer offering commission-free trading in stocks, ETFs, options and other products through the Webull trading app, along with market data tools and margin trading. Based on Wall Street in New York City, the firm is the United States brokerage of Nasdaq-listed Webull Corporation, which was founded in 2016 and operates in more than a dozen markets worldwide.
Webull Financial LLC – By the Numbers:
- CRD #: 289063
- Regulatory Events: 5
- Arbitration Events: 1
- Broker Employees: 102
Webull Financial LLC – In the News:
FINRA v. Webull Financial LLC (Case #2021073151001) – Between at least October 2021 and April 2023, Webull routed options orders for execution with inaccurate origin codes, resulting in the execution of approximately 180,000 options contracts with an origin code of “Customer” that should have been coded “Professional Customer.” These inaccurate origin codes were contained in the firm’s books and records. As a result, Webull violated Section 17(a) of the Securities Exchange Act of 1934, Exchange Act Rule 17a-3(a)(6)(i), and FINRA Rules 4511 and 2010. In addition, from at least July 2021 through August 2023, Webull violated FINRA Rules 3110 and 2010 by failing to establish and maintain a system, including written supervisory procedures (WSPs), reasonably designed to supervise the accuracy of its options order origin codes. For these violations, the firm is censured and fined $115,000.
FINRA v. Webull Financial LLC (Case #2021072231801) – From January 2019 to December 2022, Webull Financial failed to reasonably supervise and retain social media communications that promoted the firm posted by individuals with followings on social media (commonly known as “influencers”). Some of those communications included statements that were not fair and balanced or were promissory or exaggerated. Therefore, the firm violated FINRA Rules 2210, 2220, 3110, 4511, and 2010, Exchange Act § 17(a), and Exchange Act Rule 17a-4. From June 2020 to December 2022, Webull Financial failed to timely deliver Form CRS to certain customers, make and preserve related records, and establish, maintain, and enforce a supervisory system reasonably designed to achieve compliance with its Form CRS obligations. Therefore, the firm violated Exchange Act § 17(a), Exchange Act Rules 17a-3, 17a-4, and 17a-14, and FINRA Rules 3110, 4511, and 2010. For these and other violations, Webull Financial is censured and fined $1.6 million.
FINRA v. Webull Financial LLC (Case #2021070581401) – From December 2019 (when the firm first offered options trading) through July 2021, the firm did not exercise reasonable due diligence before approving customers to trade options. During this period, the firm employed an automated, electronic system to approve or disapprove customer accounts for options trading. Flaws in that system—and the firm’s supervision of the system—resulted in customers being approved for options trading authority who did not satisfy the firm’s eligibility criteria or whose accounts contained red flags that options trading was potentially inappropriate for them. As a result, the firm violated FINRA Rules 3110, 2360, and 2010. From May 2018 through December 2021, the firm’s supervisory system, including written supervisory procedures (WSPs), was not reasonably designed to identify and respond to customer complaints. As a result, the firm violated FINRA Rules 3110(a), 3110(b)(5), and 2010. Also during this period, the firm did not report certain written customer complaints to FINRA, as required, in violation of FINRA Rules 4530 and 2010. Finally, from December 2019 through March 2021, the firm did not maintain and keep current an options complaint log in violation of FINRA Rules 2360(b)(17) and 2010.
The FINRA actions described above involve Webull Financial LLC itself, and investors whose losses are connected to the conduct FINRA identified may have claims against the firm. Gana Weinstein LLP offers free consultations and we welcome all inquiries.