June 8, 2019
In recent divorce proceedings, a Wall Street employee sought the modification of his alimony and child-support payments because he had lost his jobs and the new job wasn't firing on all cylinders yet and, well, you know, things are tough and he's doing his best but, your honor, help me out here, please. Two courts heard his plea. Both courts essentially told him to try a little bit harder.
Perhaps had Mark Zuckerberg not dropped out of Harvard to become a billionaire, he might have paused long before uttering "domination" to describe his ambitions. Christ said that the love of money is the root of all evil, but that's not quite right. He wasn't crucified for profit. The love of money for its own sake doesn't make one evil; it makes one a pathetic miser. The root of all evil is something else.
Sometimes when you initiate litigation you don't know the names of all the parties that you want to sue. In such cases, you will often see a caption list "John Doe, Respondent" or "John Does #1 - #3, Defendants." As the lawsuit makes its way through Discovery, those unknown names may become disclosed, and, accordingly, the Plaintiff or Claimant may move to amend the pleadings in order to identify the actual name of any John Doe. Depending upon when such a motion is made, a whole host of due process issues may arise -- not the least of which is whether the last-minute amendment would constitute litigation by sandbag and violate a John Doe's due process rights. I've been through the FINRA desert on a horse with no name. It felt good to be out of the arbitration.
Notwithstanding the self-congratulatory press releases from the Securities and Exchange Commission about the purported success of its Whistleblower program, not every whistleblower shares that perspective. Nothing seems to get accomplished according to a reasonable timeline. There are delays without explanation. There are delays with explanations that lack credibility. There are delays because the federal regulator seems to relish being a bully and thinks that it's always doing everyone a favor and you should simply take a number, wait your turn, and keep your mouth shut. In the end, far too much of the SEC's Whistleblower program treats the whistleblower as an adversary and the whistleblower's tips as an annoyance. Lost in that misguided approach is that the benefit of a whistleblower program is its role as an early warning system to protect the investing public and better police Wall Street. Despite a lot of crap that continues to bedevil the effectiveness of the SEC's Whistleblower program, a recent SEC Order making a $3 million award is a very, very pleasant surprise and an encouraging step in the right direction!
Imagine that you're a stockbroker and a customer asks if you would watch her pet for a week while she's out of town. You agree to take the pet to work and leave it there overnight. The customer is happy with that arrangement and thanks you. So, you take the pet to work and leave it there overnight. Upon your return to the office the next morning, the dog is happy to see you but your manager, not so much. The manager tells you not to leave the customer's pet in the office overnight and to take the animal home when you leave work. Accordingly, for the balance of the week, you do as you're told and bring the dog to work but take it home after hours. The customer doesn't complain. Notwithstanding, your manager fires you at the end of the week. He tells you that it's against company policy to store any customer's property at your residence. But I never hid anything, you say; moreover, you knew that I was bringing the pooch to work in the daytime and it was you who told me to take the dog home. The manager says rules is rules. He says you're still fired. Sound nuts? Well, maybe it's not as far fetched as you might think. Consider this recent FINRA arbitration.