According to FINRA, Stirlingshire Investments was censured and fined $40,000 in January 2026 for violating Regulation Best Interest by failing to establish and enforce a supervisory system for recommendations of non-traditional exchange-traded funds (NT-ETFs), and for failing to timely file required offering materials with FINRA for two private placement offerings sold to 21 investors.FINRA found that three of the New York-based firm's registered representatives recommended NT-ETFs—specifically inverse or leveraged exchange-traded funds—to more than 25 retail customers. These are complex products that reset daily and are generally intended for short-term trading, not long-term investment. They can rapidly diverge from the performance of the underlying index when held beyond a single trading day, making them unsuitable for many retail investors.The firm's written supervisory procedures (WSPs) actually contained an explicit prohibition on NT-ETF purchases in customer accounts and instructed supervisors to cancel all such purchases. Despite having this rule in place, the firm failed to enforce it. It put in place no alerts, exception reports, or other supervisory tools or procedures to identify and review NT-ETF recommendations made by its representatives. In other words, the firm had a policy it did not follow and no mechanism to detect when the policy was being violated. This failure constituted a violation of Reg BI's Care Obligation, which requires firms to establish policies reasonably designed to ensure representatives make recommendations in customers' best interests.Separately, FINRA found that the firm failed to file offering materials with FINRA for two private placement offerings issued by the firm's parent company, which a registered representative sold to 21 investors. The firm ultimately filed the required materials—but only two years after the last sale had been completed.For investors, this case highlights two key lessons. First, non-traditional ETFs are not buy-and-hold investments, and any broker recommending them should be able to clearly explain why the product is appropriate for your specific investment goals and time horizon. Second, private placement offerings are required to be disclosed to regulators, and delays in filing can obscure important information from the supervisory review process. Investors considering private placements or complex ETF products should ask pointed questions about suitability and ensure their broker has disclosed the investment to the appropriate regulatory authorities.