Broker- Dealer Law Corner

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FINRA’s New Rules Are A Game-Changer, Especially When It Comes To Hiring . . . And Not In A Good Way

April 20, 2021

For many years, FINRA has attempted in several settings to substitute objective criteria for subjective ones, to try and make things easier for itself, and to make things more consistent from district to district and from firm to firm. For instance, FINRA used to – and may still today – identify firms whose exam cycles should be accelerated by assigning numerical values to a variety of characteristics (theoretically risk associated), and then adding them up. …

Broker- Dealer Law Corner

FINRA Got It Right When It Comes To BCPs . . . But Not So Much On SARs

By Alan Wolper

April 10, 2021

FINRA is often accused (mostly rightfully, and certainly by me) of being a horse-is-already-out-of-the-barn sort of regulator, jumping on an issue only after the problem has already arisen and made it to the front page of the Wall Street Journal. But, that’s not always the case. Indeed, there are occasions when FINRA is out ahead of the curve, providing warnings of problems that may seem remote at the time, but which later manifest themselves. Such…

Broker- Dealer Law Corner

Credit Suisse Runs Into Trouble Trying To Monitor Outside Brokerage Accounts, Despite Its Best Intentions

By Alan Wolper

April 7, 2021

I am back from Spring Break — spent here, in my home, of course — and I hope that you all had a nice Easter or Passover, or whatever. Good to be back. – Alan Sometimes, the numbers that FINRA cites in its settlements with big broker-dealers are so ridiculously large that it’s nearly impossible to compare these cases with those brought against small firms for similar rule violations. See, for instance, my recent blogs…

Broker- Dealer Law Corner

If You Supervise Yourself — Which You Cannot Do — Make Sure You Do It Right

By Alan Wolper

March 23, 2021

I have always operated with the understanding that, per FINRA rules, one cannot supervise him- or herself. Hardly an outrageous proposition. Today, however, that fundamental, bedrock understanding was so shaken, it has left me wondering whether anything is what it seems (especially when coupled with Loyola’s win this weekend over Illinois, which, really, can only have occurred in some bizarro alternative universe). It all stems from an AWC submitted by The Logan Group Securities,…

Broker- Dealer Law Corner

Are We Looking At The End Of Mandatory Arbitration? That’d Be OK With Me

By Alan Wolper

March 16, 2021

As everyone knows, back in the 1980s, broker-dealers fought hard for the ability to include in a customer agreement a clause mandating that all disputes be dealt with in the arbitration forum, rather than in court. It was not an easy fight, as to require a customer to arbitrate means that certain rights that would otherwise be available in court – expanded discovery, additional motion practice, an actual judge presiding over the process rather than…

Broker- Dealer Law Corner

SEC Not Only Reverses FINRA Disciplinary Action, But Provides Blueprint For Respondents To Use In Their Defense Of Similar Claims

By Alan Wolper

March 12, 2021

My friend and former colleague, Brian Rubin, publishes annually his analysis of FINRA Enforcement cases, spotting trends in terms of the number and types of matters it brings, the sanctions meted out, etc. It is an excellent tool, and eagerly anticipated by lots of us who practice in this industry. One of the hard parts of his analysis is his effort to figure out how respondents who elected to take their case to hearing, as…

Broker- Dealer Law Corner

SEC 2021 Exam Priorities

By Heidi VonderHeide

March 4, 2021

Thanks to Heidi for today’s post. – Alan Today, the SEC put out its 2021 Exam Priorities, available here. It is about 40 pages long and covers a lot of topics. While I encourage everyone to read through the document, here are the primary focus items for 2021: Overarching Themes / Focal Points: Regulation Best Interest and Form CRS: Primary focus of 2021 exams based on its prominence in the letter and all the…

Broker- Dealer Law Corner

Trends In Market Manipulation

By Blaine Doyle

February 22, 2021

Thanks to Blaine for not only attending this panel session, but for summarizing it for us! – Alan Recently, the Roaring Kitty (aka Keith Gill) and his brethren made headlines with their trading (most notably in GameStop) and the impact it had on certain hedge funds and banks. The interest on this saga seems to be universal with folks wanting to know whether or not these trader/customers were doing anything wrong and if there were…

Broker- Dealer Law Corner

I Am “Investigating” The Fact That Claimant’s Lawyers Use BrokerCheck In A Way FINRA Did Not Intend

By Alan Wolper

February 17, 2021

I get the fact that anyone silly enough to work for a broker-dealer knowingly chooses to live in a fishbowl. Thanks to BrokerCheck, you can very easily learn more about a registered representative than you can about, say, a doctor, a teacher, a lawyer, you name it, all through a couple of mouse clicks. But, this is no secret, as I said. It is the price one pays to work in the securities industry, and…

Broker- Dealer Law Corner

Another Day, Another Complaint About The Unlevel Playing Field In FINRA Arbitrations

By Alan Wolper

February 15, 2021

I just read this article – admittedly authored by lawyers, Ethan Brecher and Ana Montoya, whose website provides that one of their three principal areas of practice is representing investors “who have been defrauded by their securities brokers”[1] – that advocates for a new FINRA rule designed “to limit wasteful post-arbitration appeals by brokerage firms.” And I just had to respond. Because I am soooo tired of claimant’s counsel complaining about the supposed advantages…

Broker- Dealer Law Corner

Blog Authors

FINRA’s New Rules Are A Game-Changer, Especially When It Comes To Hiring . . . And Not In A Good Way

FINRA Got It Right When It Comes To BCPs . . . But Not So Much On SARs

Credit Suisse Runs Into Trouble Trying To Monitor Outside Brokerage Accounts, Despite Its Best Intentions

If You Supervise Yourself — Which You Cannot Do — Make Sure You Do It Right

Are We Looking At The End Of Mandatory Arbitration? That’d Be OK With Me

SEC Not Only Reverses FINRA Disciplinary Action, But Provides Blueprint For Respondents To Use In Their Defense Of Similar Claims

SEC 2021 Exam Priorities

Trends In Market Manipulation

I Am “Investigating” The Fact That Claimant’s Lawyers Use BrokerCheck In A Way FINRA Did Not Intend

Another Day, Another Complaint About The Unlevel Playing Field In FINRA Arbitrations

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