On November 5, 2026, FINRA announced a $4.2 million fine against Webull Financial LLC for failing to implement reasonably designed programs for anti-money laundering (AML), identity theft prevention, and best execution. The Webull FINRA fine follows FINRA's finding that the firm's compliance program did not keep pace with its growth between January 2020 and September 2023, a period in which Webull opened millions of new customer accounts each year.

Webull consented to the entry of FINRA's findings without admitting or denying the charges. FINRA also ordered the firm to certify remediation of the deficiencies in its AML and identity theft prevention programs and to retain an independent consultant to address its best execution program.

"Webull's business grew rapidly, but its compliance program did not keep pace."

Bill St. Louis, Executive Vice President and Head of Enforcement, FINRA, November 5, 2026

What FINRA Found

Customer Identity Verification

FINRA found that 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. According to FINRA, the firm approved accounts for more than 50 customers who submitted photos of scenic landscapes instead of government-issued identification. In other instances, it approved accounts despite information in its own systems indicating that the customers were deceased.

Suspicious Activity Detection and Surveillance

Over the same period, FINRA found that Webull failed to detect and report a variety of suspicious transactions. It failed to identify or investigate 473 unauthorized ACH transfers used to move 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.

FINRA also found that Webull lacked several surveillance capabilities essential for identifying fraudulent activity at the firm. The firm had no processes to identify potentially suspicious out-of-the-money options trading, lacked surveillance to identify unrelated customers trading from the same address or device, and lacked reasonable surveillance to detect fraudulent account takeovers in a timely manner.

Identity Theft Prevention

Between January 2020 and February 2023, FINRA found that Webull did not have an identity theft prevention program reasonably designed to detect, prevent, and mitigate identity theft, relying instead 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. It 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

Separately from the AML findings, FINRA found that Webull failed to reasonably supervise for best execution. At certain points between at least February 2020 and at least May 2025, the firm conducted no review of the execution quality available at competing market centers, and at other times obtained the data but did not sufficiently review it. FINRA also found that the firm 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.

The Settlement and FINRA's Guidance

Webull agreed to pay the $4.2 million fine, 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 influencers who promoted the firm.

FINRA's release points to its existing guidance on these obligations. Regulatory Notice 19-18 provides guidance on suspicious activity monitoring and reporting obligations under FINRA Rule 3310, the AML compliance program rule. Regulatory Notice 21-23 provides information on best execution obligations under FINRA Rule 5310. FINRA's 2026 Annual Regulatory Oversight Report also covers its areas of concern on AML and on best execution and order routing.

Frequently Asked Questions

The Sentinel Perspective

FINRA found that Webull approved accounts without forming a reasonable belief that it knew customers' true identities, and that it lacked surveillance to identify suspicious patterns such as unrelated customers using the same address or device.

Sentinel provides KYC onboarding and customer risk assessment, enhanced due diligence, and continuous customer monitoring that re-screens existing customers against PEP, sanctions, and adverse media data and generates alerts when something changes. Each decision is recorded in an audit trail.

Truth Technologies provides AML, KYC, OFAC, and sanctions screening compliance solutions through the Sentinel platform. This post is published for informational purposes only and does not constitute legal advice. The findings described are those of FINRA, which Webull consented to without admitting or denying. All facts are sourced from FINRA's news release linked above.