So, after all the hubbub about how Reg BI was going to turn the brokerage industry on its head, given the new standard of conduct – more like that of a fiduciary – that it was imposing on BDs and registered reps, I’m sure everyone was as super excited as I was the week before
Churning
Another Fine Churning Mess
By UB Greensfelder on
I apologize for taking so long between posts, but, to be fair, there’s been a lot going on in the past week or so that has captured my attention! I wish everyone a happy and SAFE new year! – Alan
While undoubtedly FINRA will be issuing its annual “examination priorities” letter any day now, that…
How NOT To Supervise For Churning
By UB Greensfelder on
As should be clear to readers of this Blog, I find that Enforcement actions often provide the best guidance in terms of what regulators deem to be unacceptable conduct, which is very useful when dealing with subjective standards like “reasonableness.” This past week, FINRA published an AWC submitted by Coastal Equities, Inc. that offers a…
FINRA’s Attempt To Change Well-Established Federal Law On Churning
By UB Greensfelder on
When Michael called me to tell me about the subject of this post, I frankly thought he was making it up. The notion that FINRA was seriously suggesting deleting one of the historically recognized essential elements of a churning claim — principally because otherwise it was too difficult for FINRA to prove churning — seemed…
When It Comes To Churning, FINRA Knows What’s Best For Investors
By UB Greensfelder on
Since I first started practicing law back in the 1980s, customer complaints against brokers have often involved allegations of “churning,” which is deemed to be fraud. Now, as it was 30+ years ago, to prove a churning claim, a customer needs to demonstrate that (1) the broker acted with scienter, which is defined to…