Yesterday, FINRA released its 2015 Annual Report, and it contained maybe one surprising figure: a decrease in the amount of fines it levied. Beyond that, however, it was more of the same that we have seen over the last few years; just read my blog from a year ago about the 2014 report and
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The Wendell Belden Case And Its Progeny: Fiduciary Before Fiduciary Was Cool
By UB Greensfelder on
The entire securities world is anxiously awaiting the implementation of the fiduciary standard over retirement accounts, and, by most accounts, the eventual spread of that standard to ordinary investment accounts. I am not prepared to argue that this is not a big deal, and will cost the industry a ton of time and money to…
In AML World, The Need To File A SAR Can, Apparently, Be Too Obvious To Ignore
By UB Greensfelder on
If you’re reading this, then you undoubtedly already know that FINRA and SEC are, simply, AML crazy. Rightly or wrongly, they are both focusing more than ever on broker-dealers’ fulfillment of their supervisory obligation to be sensitive to the laundry list of red flags first articulated in a Notice to Members back in 2002 that…
Whatever Happened To The “Self” In Self-Regulation?
By UB Greensfelder on
Posted in Board of Governors, FINRA
Buried among the usual hodgepodge of stuff in a recent weekly FINRA blast email was a notice that the SEC was accepting comments on FINRA’s request to change the composition of the NAC, the National Adjudicatory Council, so that it mirrors the FINRA Board of Governors, and instead of having an equal number of industry…
The Long Arm Of The Law Has Nothing On FINRA’s Reach
By UB Greensfelder on
So, you’re a registered rep, working for a broker-dealer. Necessarily, you are registered with and subject to the oversight of FINRA, not a particularly happy proposition. But at least you can take comfort in the fact that while FINRA may have the right to stick its nose into your securities business, what you do away…
Altering Documents In A FINRA Arbitration Can Have Consequences That Go Well Beyond The Arbitration Itself…At Least For Respondents
By UB Greensfelder on
The FINRA investigative process and the arbitration process exist side-by-side; at times, the misconduct that is alleged by a claimant in a Statement of Claim may simultaneously be the subject of an examination by Member Regulation, or even an Enforcement Complaint. Ordinarily, Enforcement doesn’t pay much attention to what happens in a parallel arbitration, except…
According To FINRA, “Culture Of Compliance” Is Not Only Definable, It’s Enforceable
By UB Greensfelder on
Earlier this year, as part of its 2016 Examination Priorities, FINRA spent a lot time discussing the “culture of compliance” at broker-dealers, the notion that firms need to create an atmosphere where compliance with rules and regulations is more than just lip service, but, rather, where it is a priority established by firm management –…
Good Grief! MetLife Agrees To $20 Million Fine, And Another $5 Million In Restitution! For Negligence!
By UB Greensfelder on
FINRA announced today that it entered into a settlement with MetLife Securities, Inc. in which MetLife agreed to pay FINRA a $20 million fine and its customers up to $5 million in compensation for, basically, making misrepresentations over a five-year period to customers who replaced one variable annuity with another regarding the costs of making…
Updates: Two Losers + One Positive Note = A Bad Week For Broker-Dealers
By UB Greensfelder on
There have been some developments this week in a few matters on which I have previously offered my views. To help you stay on the cutting edge of financial world current events as you mingle at your upcoming Cinco de Mayo fiestas, here are three updates. Two, not surprisingly, represent wins for the regulators. The…
Not So Naked And Not So Afraid: FINRA’s New Compensation Rule Does Not Require Brokers To Bare All (Financially) When Changing Firms
By UB Greensfelder on
Two years ago, FINRA first proposed to the SEC a rule that would require brokers to disclose to clients not only when they receive compensation (including signing bonuses and other payments) to switch from one broker-dealer to another, but, worse, the amount of that compensation. The industry was seriously not pleased with the rule. FINRA,…