SEC Charges Former Compliance Officers for AML Violations

The U.S. Securities and Exchange Commission (SEC) fined two former anti-money laundering (AML) compliance officers, Kevin McKenna and Eugene Terracciano, for aiding and abetting Aegis Capital Corp.’s AML violations.  While McKenna has not denied or admitted to the SEC’s claims, he has agreed to pay a $20,000 fine for the charges and he has also been barred by the SEC from serving in a compliance or AML capacity but still has the ability to reapply.

The SEC also charged Terracciano, who is currently awaiting a public hearing, with failing to file suspicious activity reports (SARs) which contributed to Aegis’ violations. The SEC stated that while Terracciano served as a compliance officer for Aegis from September 2013 to 2015, he was in charge of filing SARs on behalf of the company but failed to do so despite being alerted by red flags.

Additionally, Aegis Capital was fined a total of $1.3 billion by the SEC and the Financial Industry Regulatory Authority (FINRA).  The SEC fined Aegis $750,000 for failing to file SARs on suspicious transactions while FINRA has fined Aegis $550,000 for failing to supervise their AML program. The CEO and owner of Aegis, Robert Eide, was also fined $40,000 by the SEC for being the “cause” of its AML violations.


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