June 16, 2018
The Human Factor On Wall Street (BrokeAndBroker.com Blog)
"A Former NASD Employee" shoves our faces in the toilet bowl and makes us hold our breath as we struggle. It's not a pretty picture. We have an industry where good people often find themselves at bad firms. Some say that's part of the problem. Good folks shouldn't work at bad firms. Good folks shouldn't rationalize how they are furthering fraud. Good folks shouldn't prop up dishonest firms and low-life stockbrokers.
Today's BrokeAndBroker.com Blog presents a "Guest Blog" reprinted from an email, which was sent to us by an individual who prefers to maintain his anonymity and has asked to be known only as "A Former NASD Employee." It is a powerful and heart-wrenching story about a former regulator who became an industry compliance officer. Tomorrow, our publisher Bill Singer will offer his comments. For today, we let the email speak for itself.
R.I.P. PCAOB Audits by Stephen Kohn
(BrokeAndBroker.com Guest Blog)
FINRA Small Firm advocate and industry reformer Stephen Kohn views the PCAOB Audi as "one of the most egregious requirements stuffed down our throats that I can remember in my 22 years of small firm ownership." Kohn reports that bi-partisan Senate and House Bills are attempting to make their way to the respective floors for approval. Learn more about the proposed changes and what you can do to further the effort. FULL TEXT Bills and Congressional Contact Lists online.
Wall Street can be a frustrating, infuriating, puzzling, and perplexing place to work. And those emotions can be felt with equal fervor by the industry's firms, employees, public customers, and regulators. At times, it seems that you get rewarded for doing bad and punished for doing good. Other times, what, at first blush, seemed good turns out to be bad and vice versa. There are no easy answers. There are no easy solutions. In today's BrokeAndBroker.com Blog we consider the story of a stockbroker who made a nice chunk of change for his customer in the speculative world of options trading -- that is, until the stockbroker made a few lousy investments and lost a nice chunk of change for the same customer. The options trading losses shocked the stockbroker, who came up with a formula to repay his client. It's nice that a stockbroker puts his money where his mouth is and digs into his own pocket when a proposed investment goes into the toilet. I'm sure the client thought he was dealing with a stand-up guy. The thing is, however, that the stockbroker entered into the repayment schedule without telling his employer brokerage firm. They got a rule against that on Wall Street. When you understand the rationale for the rule, it makes sense. Making sense is a good thing. How we make sure that sensible things get done isn't always a pretty sight to behold, as today's FINRA regulatory settlement demonstrates.