Blog by Bill Singer WEEK IN REVIEW

August 13, 2016

A FINRA member firm has its sights on a well-connected trader or top producer or dynamic manager -- fill in the blanks as you will. The FINRA firm and the desired employee talk, they negotiate, they bargain, and, eventually, if all goes well, they forge a deal. Of course, there are deals and then there are deals. In the tortured ways that law and business clumsily embrace, we find ourselves considering documents prepared by lawyers at the behest of their financial services clients: The results range from ponderous to laughable but often with the common denominator of being indecipherable by most human beings. Still, hope springs eternal and armed with reams of paper, the hopeful employer and wannabe employee sign on the many dotted lines. And then all hell breaks loose when promises aren't kept, representations turn out to have been inflated, and things just don't quite pan out.

In today's Blog we consider a case involving an Employment Agreement and a $700,000 Promissory Note and one FINRA member firm and one non-FINRA member firm and one unhappy former employee. READ

BREAKING NEWS: 2 Circuit Denies Criminal Expungement

In 2001, Jane Doe was convicted in federal district court of health care fraud and was sentenced principally to five years' probation. In 2014, Doe moved to expunge her conviction because it prevented her from getting or keeping a job as a home health aide. The issue of whether a criminal record can be expunged has taken on added urgency in this digital age.  More and more information is more easily available -- and that includes damaging records of criminal charges and convictions. In Jane Doe, Petitioner-Appellee, v. United States of America, Respondent-Appellant (Opinion, 2Cir,15-1967-CR / August 11, 2016), the 2nd Circuit dismiss Doe's motion. READ

Wall Street is more a global financial village than a one-way street in lower Manhattan. Sometimes employees have to relocate away from their homelands to where the jobs are. Sometimes employers go to foreign markets where they see potential for new lines of business or cheaper labor. Whatever the motivation, a FINRA member firm's use of Foreign Associates has regulatory and compliance ramifications. In a recent FINRA regulatory settlement, the violations involving Foreign Associates don't come off as particularly serious but the lessons are invaluable for firms contemplating similar relationships. READ

The Stockbroker, Her Cancer Patient Friend And Customer, And The Estate Complaint 

A stockbroker and a client start out as customers but then develop a friendship. The customer is diagnosed with cancer. The stockbroker organizes a support group for her client and friend.  It all starts off as a lovely, heartwarming story. It doesn't quite end well. What occurred in the middle is subject to interpretation. Was this a case of the best of intentions being misinterpreted and misunderstood? Was this a case of someone trying to take advantage? Frankly, it's not an easy set of facts to confront or interpret. What is clear, however, is that there were policies, rules, and regulations that, if followed, may have avoided a lot of grief. READ

There's lots wrong with Wall Street. There are lots of things for Wall Street's regulators to be focusing their time and energy on. On the other hand, there's lots wrong with life in general and, as such, there are also lots of things for regulators and prosecutors to do all over the world. Given all that needs to be done and the limited resources to do it, sometimes you just have to wonder whether anyone in charge understands the need to triage so that we aren't diddling around with nonsense while some truly bad crooks are wreaking havoc. In a recent Wall Street regulatory settlement, we are presented with the case of a JP Morgan registered representative who managed to get himself fined and suspended for his role in the purchase and shipment of cars from the U.S.A. to China. READ

Submitted for your consideration is the case of a lowly bank and brokerage firm employee who doesn't quite like the fact that his personal banking account was charged overdraft fees. Unlike the rest of us, this unhappy employee had a tool to right the wrongs. He used that tool. The thing is, he should not have. In the end, it just doesn't end well for this misguided righter of wrongs. So why, then, do we secretly give him a wink and a thumb's up? READ