← Broker database 2025-05-08
Webull Financial Fined $1.6 Million for Social Media Influencer and Compliance Failures
According to FINRA, Webull Financial LLC was censured and fined $1,600,000 for failing to reasonably supervise or retain social media communications from influencers promoting the firm, along with multiple other compliance failures.
The New York firm paid social media influencers to promote its services, but these communications were not fair and balanced and included exaggerated and promissory statements. The firm failed to have a registered principal review and approve all influencer posts before publication and failed to preserve records of those posts.
The firm did not review influencer communications posted in online interactive forums in the manner required for supervising correspondence. This allowed potentially misleading content to reach retail investors without appropriate oversight.
The firm also failed to deliver its customer relationship summary (Form CRS) to customers opening accounts until approximately October 2022, despite the form being required since June 2020. A system error then prevented delivery to new customers until December 2022.
Additionally, Webull's default display for market data—used by the majority of customers across desktop, mobile, tablet, and web platforms—violated the Vendor Display Rule by showing data from only one market rather than providing a consolidated display.
The firm failed to maintain adequate financial risk management controls to prevent erroneous orders. Single order quantity and price controls were too high to prevent erroneous orders in certain securities.
At least 70 registered representatives posted messages about securities trading on an online forum accessible through the firm's mobile application, with some posts containing links to the firm's website. The firm failed to review, approve, or preserve these communications.
For investors using social media for investment information, this case highlights that influencer content may not be reviewed for accuracy. Always verify claims independently.