FINRA has fined Webull Financial LLC $4.2 million for failing to implement reasonably designed programs for anti-money laundering (AML), identity theft prevention and best execution. FINRA also ordered Webull to certify remediation of the deficiencies in its AML and identity theft prevention programs and retain an independent consultant to address its best execution program.

Webull experienced rapid and significant growth between January 2020 and September 2023, opening millions of new customer accounts each year. From at least February 2020, the firm executed billions of shares and received payment for order flow.

“Webull’s business grew rapidly, but its compliance program did not keep pace,” said Bill St. Louis, Executive Vice President and Head of Enforcement at FINRA. “Firms must ensure that their supervisory systems grow with their business and address the risks they present. Webull failed to do so in fundamental areas, including verifying its customers’ identities, detecting suspicious activity and ensuring the best possible execution of customer trades. FINRA holds firms accountable when their compliance programs do not adequately address the risks created by their business.”

AML Violations

Between January 2020 and September 2023, Webull approved the opening of more than 120,000 new customer accounts using identity verification services provided by its third-party vendors without forming a reasonable belief that it knew the true identity of those customers. For example, the firm approved accounts for more than 50 customers who submitted photos of scenic landscapes instead of government-issued identification. In other instances, the firm approved accounts for customers despite information in the firm’s own systems indicating that the customers were deceased.

Fraud Prevention Failings

Over the same period, Webull failed to detect and report a variety of suspicious transactions. For example, Webull failed to identify or investigate 473 unauthorized ACH transfers used to transfer over $1.5 million from customers at other financial institutions into Webull accounts. It also failed to timely investigate a single account that triggered nearly 13,000 alerts for potentially manipulative trading activity in more than 100 stock symbols during the approximately 18 months the account was open.

Additionally, Webull lacked several surveillance capabilities essential for identifying fraudulent activities occurring at the firm, undermining investor and market protections. The firm did not have any processes to identify potentially suspicious out-of-the-money options trading. The firm lacked surveillance to identify instances in which unrelated customers were trading from the same address or device. The firm also lacked reasonable surveillance to detect fraudulent account takeovers in a timely manner.

Between January 2020 and February 2023, Webull also failed to have an identity theft prevention program reasonably designed to detect, prevent and mitigate identity theft, instead relying on a deficient customer identification program. As a result, the firm failed to detect certain red flags associated with identity theft and opened dozens of accounts for foreign nationals using the same IP address or device. The firm also did not implement a process to check whether multiple unrelated accounts were opened using the same social security number until August 2021.

Best Execution Violations

FINRA also found that Webull failed to reasonably supervise for best execution and failed to conduct reasonable regular and rigorous reviews of customers’ execution quality. At certain points between at least February 2020 to at least May 2025, Webull conducted no review for the execution quality available at competing market centers and at other times obtained such data but failed to sufficiently review it. At certain points, the firm also failed to review execution quality for non-marketable orders—which made up 60% to 70% of its order flow during certain periods—and did not conduct reviews on a type-of-order or security-by-security basis as required.

In settling this matter, Webull consented to the entry of FINRA’s findings without admitting or denying the charges. In addition to the $4.2 million fine, Webull agreed to certify remediation of the deficiencies in its AML and identity theft prevention programs and retain an independent consultant to address its best execution program. In 2025, FINRA censured and fined Webull $1.6 million for failing to reasonably supervise and retain social media communications by individuals with a significant number of followers on social media (commonly known as “influencers”) that promoted the firm. This included statements that were not fair and balanced, or were promissory or exaggerated, among other claims.

FINRA Regulatory Notice 19-18 provides guidance to member firms regarding suspicious activity monitoring and reporting obligations under FINRA Rule 3310 (Anti-Money Laundering Compliance Program), and FINRA provides additional guidance and compliance training on AML compliance obligations. FINRA Regulatory Notice 21-23 provides member firms with information concerning best execution obligations under FINRA Rule 5310 (Best Execution and Interpositioning) and payment for order flow. The 2026 FINRA Annual Regulatory Oversight Report includes additional information regarding FINRA’s areas of concern related to AML and best execution and order routing practices.

FINRA makes available disciplinary actions and other information on its Disciplinary Actions Online database. In addition, FINRA publishes on its Monthly Disciplinary Actions page a summary of disciplinary actions against firms and individuals for violations of FINRA rules; federal securities laws, rules and regulations; and the rules of the Municipal Securities Rulemaking Board. FINRA’s use of fine monies is limited to specific purposes set forth in its public Financial Guiding Principles, which are approved by its Board of Governors. FINRA publicly itemizes and discloses how it uses fine monies each year.

About FINRA

FINRA is a not-for-profit organization dedicated to investor protection and market integrity. FINRA regulates one critical part of the securities industry—member brokerage firms doing business in the U.S. FINRA, overseen by the SEC, writes rules, examines for and enforces compliance with FINRA rules and federal securities laws, registers broker-dealer personnel and offers them education and training, and informs the investing public. In addition, FINRA provides surveillance and other regulatory services for equities and options markets, as well as trade reporting and other industry utilities. FINRA also administers a dispute resolution forum for investors and brokerage firms and their registered employees. For more information, visit www.finra.org.

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