UBS Financial Services has been fined $2m by FINRA for failing to address short positions in municipal securities on time.

As a result of the failures, the firm failed to accurately represent the tax status of thousands of interest payments to customers.

The firm was accused of reporting 2,853 positions in municipal securities as tax-exempt when they were taxable in reality.

At the same time, it reported around 950 positions as taxable when the reality was otherwise, the regulator alleged.

The failures occurred from August 2015 to the end of 2017.

The reason for the failures, according to FINRA, was the firm’s lack of appropriate supervisory systems and procedures and its ability to offer relevant guidance to its registered representatives.

The firm agreed to the settlement without accepting or refuting the allegations.

FINRA senior vice president and acting head of department of enforcement Jessica Hopper said: “FINRA member firms must be attentive to municipal short positions that impact customer accounts, and it is critical that member firms convey accurate information to customers regarding their account holdings.

“In addition, member firms are expected to take prompt corrective action after being sanctioned and avoid repeat violations.”

At the end of last year, UBS Financial Services was fined $15m by US regulators for failures in its anti-money laundering controls.