SEC Fines Haywood Securities USA $750,000 for AML and SAR Failures
The U.S. Securities and Exchange Commission has censured Haywood Securities (USA) Inc. and imposed a $750,000 civil penalty over failures in its anti-money laundering controls and suspicious activity reporting.
In an order dated September 11, 2026, the SEC said the Canada-based broker-dealer failed to file certain Suspicious Activity Reports with the Financial Crimes Enforcement Network from at least May 2021 through January 2026. The firm was required to report certain suspicious transactions or attempted transactions involving at least $5,000 under the applicable broker-dealer SAR rule.
Red flags were identified but not adequately followed through
According to the SEC, Haywood USA identified information during account opening, customer due diligence and subsequent account activity that raised potential red flags, but in a number of cases did not adequately investigate them or determine that a SAR filing was required.
The order describes weaknesses in several parts of the firm’s AML programme. Certain high-risk accounts were not included in heightened monitoring as required by the firm’s own procedures, some accounts were not adequately monitored for suspicious activity, and registered representatives were not sufficiently trained on SAR requirements.
The SEC also cited examples involving accounts connected to known criminal activity, suspicious trading in low-priced securities and attempted account openings that the firm declined because of identified red flags. The order makes clear that suspicious activity obligations can remain relevant even where a firm ultimately does not open an account.
Penalty, censure and remedial measures
Haywood USA agreed to a cease-and-desist order, a censure and the $750,000 civil money penalty. The settlement was entered without the firm admitting the SEC’s findings, other than the Commission’s jurisdiction and the subject matter of the proceedings.
The SEC said it considered remedial steps taken by the firm, including revisions to its AML policies and procedures, increased AML compliance staffing, the use of a third-party consultant to strengthen annual reviews and testing, and new supervision and review protocols.
The case is a practical reminder that an AML programme is not effective merely because policies identify relevant red flags. Firms must ensure that red flags identified during onboarding and ongoing monitoring are investigated, escalated and translated into reporting decisions where required.
