According to FINRA, a FINRA extended hearing panel expelled Alpine Securities Corp. from FINRA membership and ordered the firm to pay more than $2.3 million in restitution to customers for converting and misusing customer funds and securities, engaging in unauthorized trading, charging unfair prices and unreasonable fees, and making an unauthorized capital withdrawal.

Alpine Securities was one of the largest clearing firms in the United States until 2018. Due to increased clearing-related, compliance, and legal expenses, its profits declined precipitously in 2018, making it difficult to continue its retail securities business. The firm contended it advised customers in August 2018 that it would stop carrying retail accounts and impose additional fees, including a $5,000 monthly account fee, on retail customers who did not close their accounts.

The hearing panel found that Alpine Securities provided minimal notice of its business plan change and additional fees. Because of a back-office system change, reduced staffing, and an inadequate telephone system, customers encountered difficulties reaching the firm and logging into their accounts online.

The panel found that: the $5,000 monthly account fee, 1 percent per day illiquidity and volatility fee, and $1,500 certificate withdrawal fee were unreasonable and the $5,000 fee was applied discriminatorily; the firm's appropriation of customer positions valued at $1,500 or less for one penny per position and 2.5 percent market-making/execution fee resulted in unfair prices and commissions; the firm converted and misused customer funds and securities by removing customer securities improperly deemed abandoned" and "worthless" and seizing customer securities to cover debits related to excessive and unreasonable fees; the firm engaged in unauthorized trading by moving customers' securities from customer accounts to firm accounts without authorization to cover outstanding debits and because it improperly identified securities as "worthless