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

By Alan Wolper on May 31, 2019

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 of proof. No matter the facts, no matter the allegations, magically, decisions by the Hearing Officer, and by the panel…

Broker- Dealer Law Corner

Do Customers Actually Use BrokerCheck? This FINRA Complaint Suggests They Don’t

By Chris Seps on May 28, 2019

I heartily endorse this post from my colleague, Chris, who’s been quiet of late. It says a lot about FINRA, in terms of how it deigns to spend your assessment money, how fairness in the Enforcement process can be completely illusory, and how it is consistently unable to convince much of the investing public that it is serving any real function. – Alan FINRA’s mission is “investor protection.” In furtherance of that goal, FINRA has devoted significant…

Broker- Dealer Law Corner

FINRA Proposes To Dispense With Due Process, All Because It’s Failed To Do Its Job Of Policing The Markets

By Alan Wolper on May 7, 2019

Reading Reg Notice 19-17 makes me think of the legal arguments that I’ve recently read regarding whether a president can be found guilty of obstructing justice if the actions in question were taken out in the open, for everyone to see. Here, FINRA’s proposed power grab is simply outrageous, but, you got to give them credit, it is certainly being done right out there for everyone to see. It doesn’t make it right, however, no…

Broker- Dealer Law Corner

FINRA’s Proposal On High-Risk Firms Is A Must-Read, But Hardly A Must-Enjoy

By Alan Wolper on May 3, 2019

I apologize for all the posts this week, but I am traveling and am in a different time zone, so I am awake at hours when, ordinarily, I would be asleep, giving me time to muse. Anyway, given that, I will not test your willingness to indulge my random thoughts a third time in one week. But…you ought to be aware of what FINRA did yesterday, when it published Reg Notice 19-17. As I…

Broker- Dealer Law Corner

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

By Alan Wolper on May 2, 2019

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 (1) that there is, in fact, a benefit of self-reporting, and (2) what that self-reporting must look like to actually…

Broker- Dealer Law Corner

The Folly Of ADV Disclosures: What The Robare Decision Teaches About Trying To Do It Right

By Alan Wolper on May 1, 2019

Most of the time, the cases I write about were some other lawyer’s. In some respects, it’s easier to offer comments when it isn’t my case. I can, hopefully, be more objective, less pissed off (when the result is one I disagree with, of course), and content merely to mine the case for interesting lessons applicable to all my readers. This post, however, is entirely personal. It concerns a case that my colleague and partner,…

Broker- Dealer Law Corner

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

By Alan Wolper on April 28, 2019

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, the NTM resulted in a change to the Guidelines that explicitly permitted the consideration of “the amount of the…

Broker- Dealer Law Corner

The SEC Released A Risk Alert On Reg S-P, a/k/a How To Avoid A $1 Million Penalty

By Alan Wolper on April 23, 2019

I am hardly saying that SEC Regulation S-P is the sexiest of regulations. I mean, has any customer is history actually read one of those exciting statement stuffers that discloses in some dense font a BD’s privacy policy? Likely not, but, nevertheless, it remains that in this day and age, with hacking and phishing and cybersecurity a part of the everyday vernacular, Reg S-P is something that BDs cannot afford to be even slightly unfamiliar…

Broker- Dealer Law Corner

Is FINRA’s New Regulatory Notice On Departing Reps A Unicorn?

By Alan Wolper on April 18, 2019

FINRA came out with a slightly weird Regulatory Notice last week. In a succinct document, barely over two pages, FINRA addressed something that may, or may not, actually be of concern to anyone. In short, Regulatory Notice 19-10 states FINRA’s position on what a broker-dealer is supposed to tell the customers of a registered representative who “departs” the firm…at least those customers who bother to ask. According to FINRA, the reason it has chosen to…

Broker- Dealer Law Corner

Wedbush Learns That It’s Not Enough Just To Spot Red Flags

By Alan Wolper on April 16, 2019

I have been busy the last month getting ready for a big arbitration, and attending the first week of what looks like is going to be a four- or five-week slog when all is said and done. So, I am just catching up on some recent developments, and mulling over what might be of interest to readers of this blog. I debated discussing the arbitration itself, and some of its more surreal moments, but I…

Broker- Dealer Law Corner

Blog Authors

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

Do Customers Actually Use BrokerCheck? This FINRA Complaint Suggests They Don’t

FINRA Proposes To Dispense With Due Process, All Because It’s Failed To Do Its Job Of Policing The Markets

FINRA’s Proposal On High-Risk Firms Is A Must-Read, But Hardly A Must-Enjoy

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

The Folly Of ADV Disclosures: What The Robare Decision Teaches About Trying To Do It Right

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

The SEC Released A Risk Alert On Reg S-P, a/k/a How To Avoid A $1 Million Penalty

Is FINRA’s New Regulatory Notice On Departing Reps A Unicorn?

Wedbush Learns That It’s Not Enough Just To Spot Red Flags

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