Blog by Bill Singer WEEK IN REVIEW

March 21, 2015

Merrill Lynch Blindsided By Former Employee In Promissory Note Case

The big boys just don't tend to lose their promissory note cases with any regularity: mostly because these cases are based upon executed, ironclad agreements and irrefutable evidence of money owed. Every so often, however, a former employee is pissed off and refuses to go down quietly or quickly. In a recent effort by Merrill Lynch to collect nearly a quarter of a million dollars in a promissory note balance, the former employee counterclaimed for over $1 million in his own damages. The outcome may surprise you. READ

Good for the goose, good for the gander. Or so it is said. For those of us who practice law, we know that there are always exceptions, explanations, and excuses as to why turnaround is not always fairplay. Few things in law are more enervating and disheartening than to be confronted with a tilted playing field that the groundskeepers swear is level. Sometimes you have to break the rules because justice and fairness compel such a wink. I've demanded such consideration and compassion on behalf of clients. On the other hand, sometimes it just seems like there's an old-boys' network of secret handshakes, and rules get interpreted in odd ways that favor those in power to the detriment of those lacking the right connections. READ

This FINRA regulatory case is a saga that starts in 2006 with alleged business expense misconduct; and then, from 2007 through 2015 moves through an investigation, Complaint, hearings, and appeals through FINRA to the SEC and to the federal courts. In a bit of mathematical magic, we seem to have traveled twice around a circle only to find ourselves at the end of the beginning of the beginning of the end -- the amazing Mobius Strip of Wall Street Regulation. READ

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Former Lek Employee Suspended For Taking The Fifth At FINRA

In October 2011, FINRA's Department of Market Regulation purportedly began investigating potentially manipulative trading activity occurring from at Lek Securities Corporation. In alleged furtherance of its investigation, Market Regulation demanded pursuant to FINRA Rule 8210 that Alex Lubetsky appear at an On-The-Record interview ("OTR"). When asked substantive questions during the OTR, Lubetsky asserted his constitutional right against self incrimination based upon his position that FINRA and the SEC we re acting in concert and, as such, FINRA essentially was placed in the role of a state actor.  What many layperson readers of the Decision will likely miss is that Lubetsky was suspended not because FINRA proved during a hearing that he was guilty of market manipulation but, to the contrary, FINRA only proved that he asserted his Fifth Amendment right against self incrimination and he was sanctioned for his silence and not any conduct attendant to the alleged manipulation. READ