Blog by Bill Singer Esq WEEK IN REVIEW

January 30, 2021
Imagine the plight of an associated person, who is accused of the unauthorized opening of a bank account for a client. We can all agree that's not a good blot on your industry record, and it may well derail your career. But what happens if the associated person swears on a stack of bibles that she was asked by the client to open the very bank account at issue? And what if I told you that the bank had determined that the associated person didn't steal or misuse any of the client's deposited funds? You and I, being smart and incredibly attractive folks, would likely make it a point to contact the client and ask for some statement, right? What if I told you that the bank didn't seem to think it needed to take that step? What if I told you that the bank severed its relationship with the client? What if I told you that the bank discharged its employee?
FINRA says that there is going to be a new Form U4 or, at least the form itself may not really be changing, but it will be more digitized and functional, and, well, you know, someone decided that the older, online document needed more bells and whistles, and then, when we log back onto the old, comfortable version, we find a new, unfamiliar version, and we can't quite figure out how to use the newer iteration, but, sure, over time, we get a handle on things, and after a lot of cursing and revised versions and updates, we figure out what we need to do, but we never quite understand why they futzed with something that was perfectly serviceable for a long time notwithstanding that they published an explanation that sort of seemed like it made sense, but for the fact that it doesn't but, hey, like I'm going to admit that I'm the only one befuddled by all the techy-sounding verbiage?
If your pocket has been picked, your first reaction is likely shock and anger. Then you want to find out who did it and exact some revenge. More often than not, your wallet's gone, your cash has been spent, and someone is online racking up charges on your stolen credit cards. Other than fuming, there's probably not much you can do. In a modern-day version of pick-pocketing, two brokerage firms got hit by fraudsters. One firm was targeted by cybercriminals, who traded via hacked customer accounts. The other firm was targeted by someone using a fake identity to open an account and trade through it. Apparently, two random frauds but for the fact that some of the losing trades in the hacked accounts may have generated winning trades in the fake-identity account. All of which seemed to invite a claw-back of sorts. Or so one of the firms argued.