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Matthias Knab, Opalesque:

The U.S. Securities and Exchange Commission (SEC) has ordered Canaccord Genuity LLC to pay a $20 million civil penalty after finding the broker-dealer failed to file approximately 150 suspicious activity reports (SARs) related to its equity trading businesses over a three-year period from February 2019 through March 2022.

During the relevant period, Canaccord was one of the most active participants in the U.S. over-the-counter (OTC) securities market, annually ranking among the top four market participants by notional value of trades executed in OTC securities priced under $5 per share. In 2022 alone, the firm executed approximately 10.4 million trades in OTC securities, serving large retail broker-dealers as a market maker as well as institutional clients including hedge funds and money managers.

Despite this scale of activity - and the well-documented risks associated with low-priced and thinly traded securities - the SEC found that Canaccord "failed to maintain an anti-money laundering (AML) surveillance program that was reasonably designed to detect, investigate, and report suspicious activity within its equity trading business."

Canaccord's AML compliance framework relied heavily on internal exception reports designed to flag potentially suspicious trading patterns - including "Pump......................

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