Among the criticisms I have leveled against FINRA are (1) that it is increasingly acting like a claimant’s arbitration attorney, by taking every possible opportunity to blame member firms for losses incurred by investors when other palpable reasons for those losses exist, and (2) that it loves, well after the fact, to jump in on
UB Greensfelder
The 411 On FINRA Rule 4111
By UB Greensfelder on
Posted in FINRA
Well, Memorial Day is just past us, so we all know what that means: it’s time for FINRA to conduct its first annual assessment of its member firms to determine whether they should be branded a “Restricted” firm under new Rule 4111, with all the benefits and privileges appurtenant thereto. Given that it’s pretty clear…
FINRA’s Fixation On Unpaid Arbitration Awards Has Morphed Into Something More Dangerous
By UB Greensfelder on
Shortly, I hope to get around to drafting a blog post about FINRA’s latest demonstration of abasement to PIABA and claimants’ counsel everywhere, namely new Rule 4111. But, that rule is such a monstrosity that it will take a little time to parse, and a lot of work to get the post shorter than ten…
More Thoughts On The Age Of FINRA Arbitrators
By UB Greensfelder on
Posted in Arbitration, FINRA
Not too long ago, I wrote a piece complaining about (among other things) the fact that the potential arbitrators that FINRA rolled out to the parties in a particular arbitration I was handling skewed juuuuuuust a bit towards the older end of the age spectrum; indeed, the average age of the ten potential chairpersons was…
Lack Of Diversity In FINRA Arbitration Panels, Or, How Many Old, White Guys Does It Take To Hear A Case?
By UB Greensfelder on
Let me say at the outset that I, myself, am an old (by most people’s definition, anyway), white man. So, selfishly, I’ve got nothing against old, white men. But, the fact is that FINRA arbitration panels are disproportionately populated by such guys. And I am not sure that’s a good thing for the arbitral process. …
When It Comes To Paying Commissions Only To Registered Persons, You Can’t Do Indirectly What You Can’t Do Directly. Or Can You?
By UB Greensfelder on
Let’s talk about commissions today. Or, as they are sometimes referred to, transaction based compensation. Specifically, who can receive commissions. Actually, that’s not phrased correctly. The correct phrasing of this issue, courtesy of FINRA Rule 2040, would be: to whom a broker-dealer may legally pay commissions? According to that rule, BDs can only pay…
FINRA Continues To Turn Its Back On Its Members By Failing To Pass A Popular Rule
By UB Greensfelder on
There are certain topics that broker-dealers have been encountering for decades, yet continue unnecessarily to wrestle with due to the absence of clear guidance from the regulators. I have written about one such topic before, and that’s the fuzzy line between most outside business activities, which RRs are obliged (at a minimum) by rule to…
Order Granting Motion To Vacate Arbitration Award Raises Question: Is FINRA Meeting Its Obligation To Provide A Fair Process?
By UB Greensfelder on
Posted in Arbitration, FINRA
Motions to vacate an adverse arbitration award are rarely granted by courts. Indeed, that should come as no surprise to anyone inasmuch as the awards rendered at the conclusion of the arbitral process are explicitly designed to be “final.” As a matter of both federal and state law, there are very, very few available bases…
New Account Forms: As Evidence, They Can Be A Blessing Or A Curse
By UB Greensfelder on
I am fond of saying that, at least generally speaking, the most important document in a customer arbitration alleging unsuitable recommendations is the new account form. If the NAF is in good shape, i.e., it is accurate, it is complete, it is up-to-date, it doesn’t have any changes or white-outs, then I am free to…
The Very Pricey Real Estate At The Intersection Of The Old Books-And-Records Rule And The New Reality Of How People Communicate
By UB Greensfelder on
Happy New Year! I hope you had an enjoyable holiday season. At least happier than that of JP Morgan Securities, which, right before Christmas, got to write checks to the SEC and the CFTC totaling $200 million. That’s a lot, even for JPMS. How did this happen?
Well, the story starts with a very old,…