Sanctions

Historically, one of the surest ways to get yourself permanently barred from the industry is to forge a customer’s signature on something.  According to the pertinent Sanction Guideline, at a minimum, a forgery, that is, a true forgery – a signature that is neither authorized nor subsequently ratified by the customer – should result in…

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…

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…

The day after Christmas, FINRA issued a press release announcing that five big firms – Citigroup, J.P. Morgan Chase, LPL, Morgan Stanley and Merrill Lynch – had each entered into a settlement, collectively agreeing to pay a $1.4 million fine.  Their offense?  They each violated FINRA’s supervisory rules because for a number of years, dating…

What is it with big firms and fingerprints? You may recall back in October 2017, J.P. Morgan entered into an AWC with FINRA in which it agreed to pay a $1.25 million fine for the following, as described in FINRA’s press release about the case:

FINRA found that for more than eight years, J.P. Morgan did not fingerprint approximately 2,000 of its non-registered associated persons in a timely manner, preventing the firm from determining whether those persons might be disqualified from working at the firm. In addition, the firm fingerprinted other non-registered associated persons but limited its screening to criminal convictions specified in federal banking laws and an internally created list. In total, the firm did not appropriately screen 8,600 individuals for all felony convictions or for disciplinary actions by financial regulators. FINRA also found that four individuals who were subject to a statutory disqualification because of a criminal conviction were allowed to associate, or remain associated, with the firm during the relevant time period. One of the four individuals was associated with the firm for 10 years; and another for eight years.

Ok, now compare that description to this one, from a press release that FINRA issued just two days ago to announce an AWC that Citigroup entered into, and in which it, too, agreed to pay a $1.25 million fine:
Continue Reading Big Firms Paying Big Fines: A Discussion Of Two FINRA Settlements

I have written before about the troubling lack of clarity regarding the tangible benefit of self-reporting rule violations to FINRA. While FINRA purports to provide some potential advantage for doing so, it is so awfully loosy-goosy that it remains a relatively uncommon occurrence. That’s why when a case comes down that provides some clear indication…

Last year I wrote about FINRA’s effort to encourage firms to self-report their problems, pausing to wonder at the suggestion attributed to Jessica Hopper, a Senior Vice President with Enforcement, that cooperating with FINRA by self-reporting “not only fulfills a firm’s regulatory responsibilities, but it can also mean the difference between a slap on the…