According to FINRA, Rockefeller Financial LLC (CRD #291361), based in New York, New York, was censured and fined $100,000 pursuant to a Letter of Acceptance, Waiver and Consent (AWC) issued on January 19, 2024.

FINRA found that Rockefeller Financial failed to disclose certain mark-up and mark-down information on retail customer confirmations for municipal securities transactions and corporate and agency debt securities transactions. Mark-ups and mark-downs represent the difference between the price a dealer pays for a security and the price at which it sells the security to a customer. Disclosure of these amounts is essential for investors to understand the true cost of their transactions.

The findings stated that the firm failed to include any information related to mark-ups and mark-downs for most of the affected retail customer confirmations. In some instances, the firm included the dollar amount of the mark-up or mark-down on the retail customer confirmation but did not include the mark-up or mark-down as a percentage of the prevailing market price, as required by MSRB Rule G-15 and FINRA Rule 2232.

The disclosure failure arose from a coding issue related to orders that were placed by the firm's representatives over the phone with the firm's clearing firm. While the firm's representatives generally placed orders through its clearing firm's online order entry interface, phone-placed orders did not trigger the proper disclosure mechanisms.

FINRA also found that the firm failed to establish, maintain, and enforce a supervisory system, including WSPs, reasonably designed to achieve compliance with the disclosure requirements. The firm did not have any policies or procedures in place regarding the disclosures required on retail customer confirmations and did not conduct any review of confirmations to verify they included the requisite disclosures. After the issue was identified, the firm revised its procedures to address the requirements and to provide for a review of customer confirmation content.

Without admitting or denying the findings, Rockefeller Financial consented to the sanctions and the entry of findings.

For investors, this case underscores the importance of reviewing trade confirmations carefully. Mark-up and mark-down disclosures help investors understand what they are actually paying for bond transactions. When these disclosures are missing, investors cannot fully assess the costs of their trades. Investors who trade municipal or corporate bonds should review their confirmations and ask their broker for clarification if cost information appears incomplete.