Calling All Unreasonable Financial Professionals

February 13, 2023

I entered Wall Street in 1982 in the Law Department of Smith Barney, Harris Upham & Co.

There is no more Smith Barney.

Nor, if memory still serves me, is there a Bear Stearns, Dean Witter Reynolds, Drexel Burnham Lambert, Kidder Peabody, Lehman Brothers, PaineWebber, Saloman Brothers, Shearson -- they are all gone, sliced and diced into oblivion. In 2023, the winnowing continues, and it is only a matter of time until the FINRA broker-dealer community is reduced to little more than Goldman Sachs, Vanguard, Charles Schwab, Fidelity, Bank of America/Merrill Lynch, J.P. Morgan, Morgan Stanley, and Wells Fargo. 
Bigger is not always better, so perhaps with fewer brokerage firms, Wall Street will become more nimble and less bloated. That could be. I don't think so but it's possible. What I see, unfortunately, is the ongoing erosion of independence and professionalism to the detriment of the industry and public investors. Once, stockbrokers did their own research and knew the stocks that they sold. Nowadays, it's up-selling. It's cross-selling. It's cold calling. It's pushing house product and in-house services. Sorry, I'm not going to play the apologist. I will not whitewash the dumbing-down of Wall Street.  If anything, it's a history of bad going to worse.

Over the last quarter of a century of Wall Street regulation, the result has been one step forward and two steps back.  Always, the SEC is behind the curve and regulating yesterday's fraud. These days, the federal regulator has invested far too much human and financial capital in overly ambitious rulemaking and rule-amending at the expense of robust, aggressive enforcement. FINRA, a self-regulatory-organization, fares no better. No matter the regulator, the effort seems more about the glossy marketing of the appearance of regulation rather than delivering its substance. We get podcasts. We get videos. We get Zoom calls. We get cable TV interviews. We get seminars at over-priced resorts. We get tweets. We get self-serving press releases. We get inundated with moronic reports that were commissioned to examine the obvious. What we don't get is a singular, passionate, laser-focused regulatory agenda designed to proactively ferret out fraud and retroactively prosecute and punish the scamsters and fraudsters.

The public has already voted by opting for self-directed trading rather than reposing trust and confidence in a tarnished brokerage industry. Unfortunately, in making their own investment decisions, many unsophisticated investors fell prey to what they didn't understand: Meme stocks, Crypto, NFTs, SPACs, Day Trading, and the like. No one to trust. Nowhere to go. Frankly, it's a pathetic landscape filled with the walking wounded.

Maybe this year, finally, someone launches a trade group for the industry's hundreds of thousands of financial professionals. Yeah, I know, wishful thinking. But there are rumblings. I hear them. I feel them. The industry's grunts are getting fed up. They aspire to more than the glorified role of a teleservice operator working out of a soul-crushing call center masquerading as a branch office. The Covid pandemic showed them that they could work from home, work remote. The purported support services provided by the erstwhile wirehouses have been revealed as illusory -  and not worth the hit to gross commissions or fees. In 2023, if pressed, many financial professionals would admit that they now realize that they can deliver better customer service if they weren't shackled to a large industry employer by anti-consumer laws and rules enforced by co-opted industry regulators.

What the public investor and the industry both need is an honest, unconflicted financial professional firmly entrenched in the role of a fiduciary. The consequence of that empowerment would be to put meaning into the phrase: You work for me. The "you" being an independent financial fiduciary; and the "me" being the public-investor-client in contradistinction to the industry-employer.

Is it an unreasonable goal? Perhaps, but as George Bernard Shaw opined:

The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.

To all you unreasonable financial professionals out there, contact me. Let's make common cause. 

Securities Industry Commentator: A legal, regulatory, and compliance feed curated by veteran Wall Street lawyer Bill Singer

Calling All Unreasonable Financial Professionals: a personal message from Bill Singer Esq ( Blog)

Notice Regarding Paxos-Issued BUSD (Consumer Alert / New York State Department of Financial Services)

New York Securities Fraud Ruling Threatens US White-Collar Cases (Bloomberg Law by Ben Penn)


Former Bond Trader And Hedge Fund Founder Jeffrey Soberman Parket Pleads Guilty To $65 Million Ponzi Lending Scheme (DOJ Release)

California Residents Indicted For Defrauding Architecture Firm Of More Than $91,000 By Using Fictitious Law Firm And Fraudulent Target Letter (DOJ Release)

Idaho I.T. Professional Sentenced To 28 Months In Prison For Insider Trading Scheme / David Stone Electronically Accessed an Investment Advice Service’s Unannounced Stock Picks and Used that Information to Generate Millions in Trading Profits and to Provide Inside Tips to Another (DOJ Release)


SEC Sues Texas Company and Two Executives to Halt $34 Million Scheme (SEC Release)

SEC Charges Former CEO of Slync in $67 Million Offering Fraud / Defendant Kirchner Misappropriated More Than $28 Million of Investor Proceeds to Fund His Lavish Lifestyle (SEC Release)

SEC Obtains Court Order for Partial Asset Freeze and Other Temporary Relief in Fraud Action Against Microcap Public Company and CEO (SEC Release)

Kraken to Discontinue Unregistered Offer and Sale of Crypto Asset Staking-As-A-Service Program and Pay $30 Million to Settle SEC Charges (SEC Release)

SEC Proposes Enhanced Safeguarding Rule for Registered Investment Advisers (SEC Release)

SEC Finalizes Rules to Reduce Risks in Clearance and Settlement / Final rules will shorten process for settling securities transactions from two business days to one (SEC Release)

SEC Chair/Commissioner Statements on RIA and Clearance Rules Proposals

SEC Awards 30% Whistleblower Award to Claimant 
Order Determining Whistleblower Award Claim 

SEC Award Almost $3 Million Whistleblower Award to Claimant 
Order Determining Whistleblower Award Claim


CFTC Charges Three Puerto Rico Residents and Their Companies with Misappropriating Over $13 Million in Connection with Commodity Pool Ponzi Scheme (CFTC Release)

FINRA Sanctions Member Firm and Its CEO for Permitting Association of Statutorily Disqualified Individual 
In the Matter of Quint Capital Corporation and Alexander Quint, Respondents (FINRA AWC)