According to FINRA, BOK Financial Securities, Inc. was censured and fined $110,000 for inaccurately reporting transactions to the Trade Reporting and Compliance Engine (TRACE).

The firm failed to include the required No Remuneration (NR) indicator on TRACE reports for transactions in TRACE-eligible securities where no mark-up, mark-down, or commission was charged. Firm traders failed to manually enter the correct field in the firm's TRACE reporting system, leading to systematic reporting errors.

FINRA also found that BOK Financial failed to establish, maintain, and enforce a supervisory system reasonably designed to achieve compliance with FINRA Rule 6730(d). While the firm's written supervisory procedures provided for supervisory reviews of TRACE reporting, none of the reviews addressed the accurate reporting of the NR Indicator. The firm did not perform any reviews to determine whether traders accurately reported this indicator, even though manual entry carried inherent risk of human error.

Following FINRA's inquiry, the firm automated the inclusion of the NR Indicator and implemented daily and quarterly review sampling of TRACE reports. The firm also revised its written supervisory procedures to reflect these new reviews.

Accurate trade reporting is essential for market transparency and regulatory oversight. The TRACE system helps regulators and investors understand trading activity in fixed-income securities. When firms fail to report accurately, it undermines the integrity of market data that investors and regulators rely upon.

This case illustrates the importance of firms implementing automated controls where possible and conducting regular reviews to catch reporting errors before they become systemic problems.