Broker- Dealer Law Corner

Broker- Dealer Law Corner

Tag Archives: disciplinary action

A Glaring Example Of FINRA Dragging Its Feet, Culminating In A Pointless Default Decision

Posted in Disciplinary Process, Enforcement, Examination, FINRA
FINRA loves to tout its supposed intent to bring meaningful cases, cases that matter to the investing public, rather than enforcing “foot faults,” as it has been accused of doing over the years. My own experience with FINRA suggests that while it talks a big game, in reality, we all still live in foot-fault city.… Continue Reading

FINRA Touts The Fact That Its Examinations Need Not Be “Fair”

Posted in Disciplinary Process, Enforcement, Examination, FINRA
While I feel I have enjoyed as much success defending respondents in FINRA Enforcement matters as anyone, I am still careful to caution clients who are unwilling to consider any settlement that going toe-to-toe with FINRA at a hearing is always a difficult proposition, even though they are presumed innocent and FINRA bears the burden… Continue Reading

Voya Settlement Shows That Self-Reporting To FINRA Can Pay Off

Posted in Disciplinary Process, Enforcement, FINRA, Sanctions
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… Continue Reading

FINRA AWC Includes Waiver Of A Fine: Is This A Sign Of Good Things To Come?

Posted in Disciplinary Process, Enforcement, FINRA, Sanctions
Way back in 2006, NASD issued Notice to Members 06-55, which tweaked the Sanction Guidelines to allow not just the size of the firm to be taken into consideration when determining the appropriate sanctions to be meted out, but, more importantly, how well, or how poorly, the firm is doing on its income statement. Specifically,… Continue Reading

Money Talks, And FINRA Is Listening

Posted in Disciplinary Process, Enforcement, FINRA, Sanctions
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… Continue Reading

BD Learns It’s Not Enough To Have A Supervisory Procedure For OBAs, You Actually Have To Follow It

Posted in Enforcement, FINRA, Outside business activities, Rule 3270, Uncategorized
In most Enforcement cases involving outside business activities, it is the registered rep who is named as the respondent, and the allegation is that the RR failed to provide notice (or timely notice) to his or her broker-dealer about the OBA. On occasion, however, it is the BD that gets tripped up, typically for not… Continue Reading

FINRA’s “Massive” Discovery Failure Results In…Absolutely Nothing

Posted in Disciplinary Process, Enforcement, FINRA, Sanctions, Uncategorized
You are not going to believe this one. Here are the unadulterated facts, taken directly from the Order entered by the FINRA Hearing Officer (an Order, by the way, which FINRA elected not to publish on its website): Five days into an Enforcement hearing against Respondent Steven Larson, “Enforcement disclosed that it just realized it… Continue Reading

No Bar For Submitting False Expense Reports?

Posted in Disciplinary Process, Enforcement, FINRA, Sanctions
Here is a post from Michael about a recent settlement involving the submission of false expense reports.  The issue isn’t the misconduct, but, rather, the rather tepid sanctions imposed.  Do I sense the pendulum starting to swing back? – Alan It is no secret that FINRA’s Department of Enforcement is attempting to maintain a lower… Continue Reading

What Is FINRA’s Job?

Posted in Compliance, FINRA
A client of mine bought a BD, thereby requiring him to go through the CMA process. It was a very small firm, with fewer than ten registered reps.  He was a newly minted 24, so he had other, more experienced principals on board to handle all supervisory responsibilities.  His job, as outlined in the firm’s… Continue Reading

What Else Is New? FINRA Skates Despite “Massive” Failure To Produce Documents

Posted in Discovery, Enforcement, FINRA, Rule 8210, Rule 9251, Uncategorized
Let’s play pretend.  Can you imagine what FINRA would do to a respondent broker-dealer in an Enforcement action that announced on Day Five of the hearing – i.e., during the “final phase” of the hearing – that – whoops! – it had forgotten to produce certain documents that it should have produced eight months before… Continue Reading

FINRA Provides The Blueprint For Monitoring Outside Business Activities

Posted in Disciplinary Process, Disclosure, Enforcement, FINRA, Outside business activities
Outside business activities are in the news. In Reg Notice 17-20, FINRA announced that it was seeking comments in an effort to learn whether or not the existing rules governing OBAs are effective.  (The comment period is open until late June, so if you have strong feelings on the subject, now is the time to… Continue Reading

Does FINRA Give Credit For Self-Reporting Problems? It Says It Does, But….

Posted in Disciplinary Process, Enforcement, FINRA, Reg Notice 08-70, Sanctions, Settlements
I read a fascinating piece the other day in BankInvestmentConsultant about FINRA’s Enforcement program, specifically about the notion of broker-dealers self-reporting problems, and whether that was a smart thing to do.  Some of the quotes attributed to FINRA senior Enforcement management are really interesting, so I wanted to share them with you in the event… Continue Reading
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