June 2, 2018
One stockbroker, five customers, four complaints: That's the setting for today's Wall Street expungement drama. Add a simmering feud between two former stockbroker partners. Toss in a wife. Toss in a mother and father. Introduce one helluva an industry lawyer. Appoint a FINRA Arbitrator who was on top of her game. Shake. Stir. Cook. Serve.
BrokeAndBroker.com Blog readers know that our publisher Bill Singer Esq. is no fan of self-regulation or of Wall Street's leading self-regulatory-organization, the Financial Industry Regulatory Authority. Bill's critiques, criticisms, concerns, and reservations aside, today is a rare day for the pages of the BrokeAndBroker.com Blog because Bill does not come to bury FINRA but to praise it! A recent FINRA AWC regulatory settlement shows how self-regulation should work and also shows how FINRA is capable of rising to the occasion. At issue in the settlement is a member firm's handling of sales of unit investment trusts and an electronic messaging system. Not the most exciting of regulatory and compliance issues but certainly the day-to-day stuff of Wall Street regulation and compliance. FINRA published a settlement document that uses plain English to explain the background and underlying events. Thereafter, FINRA builds a compelling case and justifies its sanctions, which are measured and appropriate. Maybe FINRA CEO Robert Cook is slowly turning the battleship of self-regulation? Alas . . . only time will tell. Be that as it may, Bill urges all serious investors and industry professionals to read today's analysis of FINRA's settlement.
In today's BrokeAndBroker.com Blog we consider the case of a former Ameriprise stockbroker accused of entering 30 unauthorized mutual fund purchases valued at some $260,000. Her brokerage firm seems to have been on top of its compliance duties, and busted the trades. FINRA seems to have been on top of its regulatory duties, and demanded answers. The stockbroker ducked FINRA and was suspended and then barred for her dilatory conduct but -- Eureka! -- after some eight months of playing regulatory hide-and-seek, she gets FINRA to lift the bar when she finally cooperates. And after her belated cooperation, go figure, she winds up barred.
FINRA is on the Wall Street beach again watching high flyin' kites -- or, put in more formal terms, we got another FINRA regulatory settlement involving a former Merrill Lynch registered rep accused of check kiting. In today's installment of FINRA seeking out the industry's NSF checks and calling those to atone, we got five checks spread out over three months. No . . . BrokeAndBroker.com Blog publisher Bill Singer ain't comin' to the defense of the rep. It looks like the Respondent tried to do what he was accused of. That being said, Bill still finds himself in another one of his foamy lathers as he wonders why FINRA is so ready to play the collection agent for its member firms -- or the local tough-guy enforcer -- yet FINRA doesn't seem as quick to enter the fray when an affiliate bank of its larger member firms engages in similar misconduct albeit on a larger scale and involving many more zeros following the dollar sign.