There has been a lot of discussion over the past few years, including in this blog, about the growing – and troubling – trend for Chief Compliance Officers to be named as respondents in disciplinary actions. While regulators regularly deny that they truly have it out for CCOs, as is often the case, their
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SEC Gives Advisors A Break On Custody Rule
By UB Greensfelder on
Posted in custody rule, SEC
A common complaint that I hear from broker-dealers and investment advisors is that it is nearly impossible anymore to obtain informal guidance from their regulators. Where it was once possible, even normal, to make a call and get casual advice how to comply with a particularly tricky rule, nowadays, regulators routinely decline to respond to…
FINRA’s New Rules On Seniors: Let’s Protect Them From Their Own Bad Decisions?
By UB Greensfelder on
We have written before about senior investors, but I saw a couple of things in the last couple of weeks that suggests this subject needs to be revisited.
First, back in February, the SEC got around to passing FINRA’s proposed rules to protect senior investors, including both new Rule 2165 and amendments to existing Rule…
It Can Pay To “Lawyer Up” When Dealing With FINRA
By UB Greensfelder on
Posted in Defenses, Disciplinary Process, Enforcement, Examination, FINRA, OTR, Registered Representative, Sanctions
I realize that the title of this blog post may sound self-serving, so I apologize for that up front, as it is not my intent. Still, there is a lesson here to be learned.
I got a phone call yesterday from a reporter asking me to comment on a disciplinary action that FINRA had just…
Tell Me Something I Don’t Know: OCIE’s Tips To Surviving An SEC IA Exam
By UB Greensfelder on
Let’s chalk this one up to “great minds think alike,” or maybe just “minds think alike.” You may recall that in his recent letter to member firms that accompanied FINRA’s 2017 Exam Priorities Letter, FINRA CEO Robert Cook said, “starting this year, we will publish a summary report that outlines key findings from examinations in…
FINRA Is Going Rogue…Again
By UB Greensfelder on
I read an article this week bemoaning the fact that “rogue brokers” – a term that is commonly used but steadfastly undefined – apparently remain rampant in the securities industry. Anyone that has read FINRA’s 2017 Exam Priorities Letter knows that this is one of the issues on which FINRA intends to focus its regulatory…
Supervision Requires More Than Trust; It Means Trust With Verification
By UB Greensfelder on
Back in December, the State of Massachusetts filed a Complaint against LPL and one of its big producers alleging that the producer, Roger Zullo, defrauded his clients and lied to his supervisors in connection with the sale of variable annuities. What struck me when I read the Complaint, and what has still stuck with me,…
Is FINRA Guilty Of Gaslighting Us When Its CEO Says Things Will Be Different?
By UB Greensfelder on
Posted in FINRA
Since the presidential election, heck, since the campaign, my friends and family will readily attest that my new favorite word is “gaslighting.” According to Wikipedia, it is “is a form of manipulation that seeks to sow seeds of doubt in a targeted individual or group, hoping to make the target question their own memory, perception,…
FINRA Releases Its 2017 Exam Priorities: No More “Culture Of Compliance” References, Plus The List Of Usual Suspects
By UB Greensfelder on
In the blog I posted yesterday, I discussed a late Xmas present that the 10th Circuit gave everyone who is subject to the SEC’s jurisdiction. Today, let’s talk about FINRA’s New Year’s gift to its member firms: the annual Regulatory and Examination Priorities Letter, which was released this week. As is typically the…
2017 Off To A Bad Start For The SEC As The 10th Circuit Finds SEC ALJs To Be Unconstitutional
By UB Greensfelder on
Many industry authors – including me[1] – have devoted a lot of attention lately to the SEC’s increased use of Administrative Proceedings (rather than Federal court cases) in recent years, and questioned the fairness of such proceedings, given their relative lack of discovery tools, the short timeframe provided within which to prepare a case…