I dare you. In fact, I double-dog dare you to figure out how or why FINRA decides to charge willfulness in some cases but not in others. Bottom line is that it is nearly impossible (except if you’re a big firm, in which case you can rest easy that FINRA will manage to skip the
Enforcement
The Trouble With Texts
By Alan Wolper on
Having completed my Enforcement hearing conducted by Zoom – more about that in an upcoming post – I can finally turn my attention back to some matters that arose while I was busy.
One that stood out for the sheer (and frightening) universality of its lesson is an SEC settlement entered into by Jonestrading Institutional…
Two — No, Make That Three — FINRA AML Settlements Drive Home The Point: When It Comes To Supervision, Actions Speak Louder Than Words
By Alan Wolper on
Right after I posted this, FINRA announced a third AML settlement, this time with Interactive Brokers. It was no small deal: it came with a $15 million fine and an obligation to retain an independent consultant. (In addition to the FINRA AWC, Interactive simultaneously entered into settlements with the SEC — with another $11.5…
FINRA ♥ Rule 8210
By Alan Wolper on
I hope that you have had the chance to enjoy Jessica Hopper’s paean to Rule 8210 in her recent blog posted on FINRA’s website. Very disturbing, and for all the old reasons.
First, once again, she starts by patting herself – well, not just herself, I guess, but Enforcement generally – on the back for…
For FINRA, Restitution Is The Solution
By Alan Wolper on
Seems like just days ago I blogged about Jessica Hopper and her commitment to providing restitution to customers. Since I posted that blog, there were two other settlements (which I added to that blog as updates) in which FINRA again seemed to prioritize restitution over the imposition of a fine. Yesterday, however, FINRA announced a…
The Trouble With The “Should-Have-Known” Standard, As It Applies To Red Flags
By Alan Wolper on
Last year, I wrote a piece called “Wedbush Learns That It’s Not Enough Just To Spot Red Flags.” As the title suggests, it analyzed an SEC decision in which Wedbush was sanctioned because it failed in several respects to follow up on certain red flags it saw that were indicative of potential misconduct.
I am…
SunTrust Settlement Proves That Jessica Hopper, FINRA’s Head Of Enforcement, Would Be A Good Umpire
By Alan Wolper on
I may have said this before in another post, but in my opinion, whether a baseball umpire is good or bad is not a matter of whether he has a low strikezone, a high strikezone, or a wide one. What matters is that whatever that umpire deems to be a strike vs. a ball is…
FINRA’s Concerns About Maintaining Confidentiality Seem To Be Broadening
By Alan Wolper on
I hope that, by now, everyone understands and appreciates just how freakishly sensitive the regulators are to misconduct involving the wrongful sharing of confidential information. If you don’t, however, FINRA was kind enough to publish two settlements in the last few weeks that work well to drive this concept home. And both share an interesting…
When It Comes To Suitability Violations, There Is No Flattening Of The Curve
By Alan Wolper on
Posted in Disciplinary Process, Enforcement, FINRA, Rule 2111, Senior Investors, Suitability, Supervision
Let’s take a step back from Covid-19 news, for a moment, which, rightfully, has dominated the news and everyone’s collective conscience, and focus on something that has been pervasive in the broker-dealer world for much, much longer than this virus, and which has taken its own toll on the industry in terms of dollars –…
FINRA Claims To Be Reasonable When It Comes To Sanctions, But It Is Clear That Permanent Bars Are What It’s All About
By Alan Wolper on
If you are a regular reader of this blog, you know that one of my pet peeves with FINRA is its unrelenting zeal to bar people, permanently, from the securities industry. Seemingly without much regard for the actual conduct at issue, or for the existence of mitigating circumstances. It is literally a running joke in…