SEC Charge Details, Washington D.C., Sept. 23, 2014 —
The Securities and Exchange Commission today charged Barclays Capital Inc. with failing to maintain an adequate internal compliance system to ensure the firm did not run afoul of any federal securities laws after its wealth management business in the U.S. acquired the advisory business of Lehman Brothers in September 2008.
Investment advisers are required to adopt and implement written compliance policies and procedures reasonably designed to prevent violations of the Investment Advisers Act and its rules. An SEC examination and subsequent investigation found that Barclays failed to enhance its compliance infrastructure to integrate and support the acquisition and rapid growth of the advisory business from Lehman. The deficiencies in its compliance systems contributed to other securities law violations by Barclays.
To settle the SEC’s case, Barclays agreed to pay a $15 million penalty and to undertake remedial measures, including engaging an independent compliance consultant to conduct an internal review.
“When a firm acquires an advisory business, it must devote the attention and resources necessary to build a robust compliance system."