Carlton Capital, Inc. (CRD #42533, NewYork, NewYork) submitted a Letter of Acceptance,Waiver and Consent in which the firmwas censured, fined $40,000, required to comply with the requirements of the Taping Rule, NASD Rule 3010(b)(2) until February 17, 2012, (an additional three years), and retain an independent consultant to conduct a comprehensive review of the adequacy of its policies, systems and procedures (written and otherwise) and training related to compliance with the Taping Rule, and adopt and implement the consultant’s recommendations.Without admitting or denying the findings, the firmconsented to the described sanctions and to the entry of findings that it failed to comply with the Taping Rule, in that it provided certain representatives with access to unrecorded telephone lines, allowed representatives to accept customer orders on unrecorded telephone lines when the representatives were out of the office, and failed to catalog tape recordings that registered persons hadmade. The findings stated that, during a later period, the firm installed a new systemthat recorded telephone calls to the hard drives of the computers on representatives’ desks, which was not password protected and was backed up by the firmonly once a year, and which allowed representatives access to erase recorded telephone calls. (FINRA Case #2006003684702)
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