On November 22, FINRA accepted a Letter of Acceptance, Waiver, and Consent (AWC) from a member firm regarding its alleged failure to establish, maintain and enforce a supervisory system and written supervisory procedures...more
In a series of settlements announced this year, the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) penalized several broker-dealers for allegedly failing to file...more
On August 25, 2023, Justice Wendlandt of the Massachusetts Supreme Judicial Court issued a ruling in Robinhood Financial, LLC v. Secretary of the Commonwealth which upheld the legality of the fiduciary duty standard imposed...more
The bane of every start-up company is the never-ending quest to raise capital for its operations. Newly (and not so new) formed companies seemingly would do anything to raise funds. Over the course of many decades, these...more
FINRA is often accused (mostly rightfully, and certainly by me) of being a horse-is-already-out-of-the-barn sort of regulator, jumping on an issue only after the problem has already arisen and made it to the front page of the...more
My friend and former colleague, Brian Rubin, publishes annually his analysis of FINRA Enforcement cases, spotting trends in terms of the number and types of matters it brings, the sanctions meted out, etc. It is an excellent...more
Almost three years ago, in Reg Notice 18-08, FINRA wisely (but, nevertheless, still a bit late to the party) proposed to revise its own prior guidance regarding the troublesome intersection between outside business activities...more
The Financial Industry Regulatory Authority, Inc. (FINRA) is an independent regulatory body, overseeing securities firms and their brokers and other registered personnel. Arbitration of employment disputes in the arbitration...more
As everyone is likely well aware, one of the principal changes that happened when FINRA retired the old suitability rule – NASD Rule 2310 – and replaced it with shiny new FINRA Rule 2111 back in 2012 was the broadening of the...more
The longer I do this, the more apparent it becomes just how little anything changes. Sure, some things do change, a little. Rule numbers may get updated, as Rule 2310 becomes Rule 2111. Things that once may have been done...more
FINRA’s final adjudicative body, the National Adjudicatory Counsel (“NAC”) recently issued a decision, affirming a Hearing Panel decision, sanctioning Silver Leaf Partners, LLC (“Silver Leaf”) for making improper payments to...more
Let’s take a step back from Covid-19 news, for a moment, which, rightfully, has dominated the news and everyone’s collective conscience, and focus on something that has been pervasive in the broker-dealer world for much, much...more
The Securities Exchange Act of 1934 (Exchange Act) is the principal law that regulates broker-dealers in the United States. The Exchange Act governs transactions in securities markets and regulates persons who effect such...more
FINRA and its predecessor NASD have long worked to promote fairness in the allocation of new issues of equity securities by prohibiting allocations to broker-dealers and persons who, among other things, own or control,...more
In October 2005, we wrote an article titled “Cooperation, Only More So: What It Takes to Receive Credit for Cooperating with NASD.” The title came from a line in the movie Casablanca. In it, Rick (Humphrey Bogart) is asked...more
In connection with the US Securities and Exchange Commission’s (SEC) proposed Regulation Best Interest, the Financial Industry Regulatory Authority (FINRA) has asserted (with some case law support from the SEC) that its...more
The Financial Industry Regulatory Authority (FINRA) recently published its 2018 Report on FINRA Examination Findings, focusing on (1) suitability for retail customers, (2) fixed income markup disclosure, (3) reasonable...more
As investor interest in cryptocurrencies has picked up, government agencies and non-governmental organizations tasked with protecting investors are taking a harder look at these virtual investment products. While the...more
The New York Stock Exchange LLC (“NYSE”) proposes to amend Rule 2 to remove the FINRA or other national securities exchange membership requirement for member organizations. ...more
BROKER-DEALER - Proposed Rule Change Relating To Revisions To the Definition of Non-public Arbitrator - On July 11, the Financial Industry Regulatory Authority filed a proposed rule amendment to change the definition of...more
Join the Environmental Law Institute (ELI) and the George Washington University Milken Institute School of Public Health on June 27, 2017, for a day-long conference exploring the federal government’s implementation of the...more
The Financial Industry Regulatory Authority (“FINRA”) recently issued a notice requesting comments on the effectiveness and efficiency of its Rules 3270 (Outside Business Activities of Registered Persons) and 3280 (Private...more
On May 17, 2017, at the annual FINRA conference in Washington D.C., FINRA President and CEO Robert Cook discussed the recently-launched FINRA360 initiative: a top-to-bottom review of FINRA’s operations and organization. Cook...more
The safe harbor would offer relief from certain requirements of FINRA’s research rules, but significant compliance obligations and questions remain. On April 12, 2017, the Financial Industry Regulatory Authority, Inc....more
The proposed consolidated rules bifurcate the representative-level examination program and introduce greater flexibility in obtaining and maintaining registrations. On March 8, 2017, the Financial Industry Regulatory...more