The Blog Of The Securities Industry Professional Association

Archive for the ‘Top Stories’


Why the Donald is upsetting Wall Street and Washington  In the famous novel/movie ‘Peter Pan”, Peter leads a group of miscreant orphans that live in “Never Never Land” and they never grow up and they never change.  On a daily basis they have staged fights with the local Native Indians on the island and some […]

Accredited or not?

THE APPLICABILITY OF THE “ACCREDITED INVESTOR” DEFINITION AS AN AFFIRMATIVE DEFENSE   Because there appears to be some confusion in the broker community about the applicability of the “accredited investor” definition to the defense of customer securities arbitration proceedings, I offer this perspective. The accredited investor definition is well-known, but for the reader’s convenience I […]
Comments Off on Accredited or not?

Who is the real criminal here?

Short Sale Rules being ignored On December 17th 2015 the SEC announced formal charges against Martin Shkreli and his Lawyer for committing Securities fraud, embezzling money from his hedge fund and a variety of other charges.   The SEC also said he made misrepresentations to his ‘Executing Broker Dealer” regarding the location of stock he was […]

What is Attorney-Client Privilege?

You’ve hired a lawyer to help you with the legal matter you’ve been grappling with, but as you prepare for that first meeting with your new lawyer, you may have concerns about how much information you should provide him or her. After all, you’re pretty sure your lawyer is subject to attorney confidentiality—that is, he or she is required […]
Comments Off on What is Attorney-Client Privilege?

Know when to hold ‘em, Know when to fold “em

Risk vs Reward when dealing with FINRA   We have seen yet another increase in the ‘Death Penalty” being issued by FINRA to firms across the county for a variety of reasons ranging from failure to supervise to failure to do anything.  How did we get to this point whereby almost all actions appear to […]
Comments Off on Know when to hold ‘em, Know when to fold “em

The end of Low Priced Stocks?

Caution: Low Priced Securities! For the last decade or so we have advised firms repeatedly that it’s no longer a matter of WILL Clearing firms and FINRA eliminate low priced physical stock certificates being deposited but a matter of WHEN they will end it. In the last five to seven years it seems that one […]
Comments Off on The end of Low Priced Stocks?


So my Dad would have been 76 today.  I wish I could say its been getting better since he left us a few years ago, But that’s just not the case. Its tough to be a father and you really can’t take the proper time to grieve because you have to take care of your […]

David Banerjee For the NAC

Greetings from the Securities Industry Professional Association.  It is with great privilege that we ask all SIPA members to seriously consider signing the enclosed petition for Mr. David Banerjee to be on the ballot for the National Adjudicatory Council.   I have personally known David for nearly 15 years and consider him uniquely qualified to represent […]
Comments Off on David Banerjee For the NAC

What is a Broker Dealer Worth?

The answer is that you may NEVER find out….We continue to lose Members on a regular basis who simply can’t make it and either just sell their Broker Dealer for a tiny amount of money as a shell or file for withdrawal and just give up.   We need a real Member who understands the […]
Comments Off on What is a Broker Dealer Worth?

Did Tim Cook Just Do That?

APPLE CEO IN SOME RISKY TERRITORY   Yesterday was a tense day on Wall Street.  The Asian stock markets had just collapsed and US exchanges were poised for some of the biggest declines in years.  The futures market indicated that a collapse of at least 600 points for the dow jones industrial average.  As I […]
Comments Off on Did Tim Cook Just Do That?

A Head Scratching FINRA Verdict

  Recently the National Adjudicatory Council (NAC)has been raising eyebrows with a variety of new rules, sanction guidelines and some decisions that are quite confusing to say the least.  Recently we wrote ‘Broker Beware” in which the NAC will now be recommending a lifetime bar for unsuitable trading and other infractions.  Last month the NAC issued a decision […]
Comments Off on A Head Scratching FINRA Verdict

Capital for Keeps

Recently SIPA member and former SEC attorney Russel Weigel took some time out of his life to write a book that should be on the desk of every broker trying to navigate the complex world of capital raising. We have specials on the book just for SIPA members.   Click on the link below to […]
Comments Off on Capital for Keeps

6 billion settlement but no failure to supervise?

Today a major announcement was made regarding some of the largest banks in the world: YORK/LONDON/ZURICH (Reuters) – Four major banks pleaded guilty on Wednesday to trying to manipulate foreign exchange rates and six banks were fined a total of nearly $6 billion in a settlement that substantially ends a global probe into misconduct in […]
Comments Off on 6 billion settlement but no failure to supervise?

Securities and Exchange Commission’s Cyber Security Guidance

Securities and Exchange Commission’s Cyber Security Guidance By Doug Kamin, Senior Compliance Consultant Regulatory Compliance On April 28, 2015 The Securities and Exchange Commission (“SEC”) Division of Investment Management released Cybersecurity Guidance IM 2015-02 for registered investment companies (“Funds”) and registered investment advisers (“Advisers”). Earlier this year the SEC announced that cybersecurity would be an […]
Comments Off on Securities and Exchange Commission’s Cyber Security Guidance

FINRA needs to get out of FRAUD business

Recently we discussed in ‘Broker Beware” the new NAC guidelines that call for a lifetime bar for unsuitability and for cases involving fraud.  While we think this can lead to an influx of trial lawyers attacking small firms with over blown claims of unsuitability in order to get them to settle quickly, we believe that […]

Broker Beware !

New Enforcement Sanctions from NAC  Last week the FINRA’s National Adjudicatory Council (NAC) released a statement that increases dramatically the sanctions on individuals found guilty of fraud and unsuitability.   In the statement NAC said:   The revised Sanction Guidelines now advise FINRA adjudicators to strongly consider barring an individual respondent, or expelling a firm, for cases involving fraud. […]
Comments Off on Broker Beware !


  FINRA recently launched with much fanfare its toll free senior hot line. WASHINGTON—The Financial Industry Regulatory Authority (FINRA) has launched the toll-free FINRA Securities Helpline for SeniorsTM to provide older investors with a supportive place to get assistance from knowledgeable FINRA staff related to concerns they have with their brokerage accounts and investments. Senior […]

Republican “To Do” List

Victory last night offers promise and potholes, especially to Broker Dealers  As I watched the results from the election pour in last night from across the country, I had this sudden wave of Déjà vu  sweep over me.  For some reason I have experienced this same euphoria and reaction to a political landslide before but […]
Comments Off on Republican “To Do” List

Steven Thornton for NAC

The SIPA ia proud to support Steven Thornton for the NAC.   He is a small firm owner and SIPA member who has been a supporter of your causes for years.  Please print and fax his petition as soon as possible so he can be added to the ballot.  This petition is only to have […]
Comments Off on Steven Thornton for NAC

Under the recent SEC No-Action Letter, What exactly can an “Un-Licensed” M&A Person Do?

    Part 1 – The Rules.  (Coming Next Week – An M&A Engagement Template)   M&A Brokers facilitate mergers, acquisitions, business sales, and business combinations (together, “M&A Transactions”) between sellers and buyers of privately-held companies, without regard to the size of the privately-held companies  Definition: An “M&A Broker” is a person engaged in the […]
Comments Off on Under the recent SEC No-Action Letter, What exactly can an “Un-Licensed” M&A Person Do?

Expungement and Amnesty

    Expungement of records being curtailed The SEC recently approved FINRA rule 2081 which severely limits the expungement of broker records in making settlements with customers.   The new rule will no longer allow an expungement of the customer complaint from the broker’s record as a condition for settlement.  On the surface this would appear […]
Comments Off on Expungement and Amnesty

FINRA Election For Small Firms

Now more then ever, make your voice heard! As we have in the past, the SIPA is urging all members to have your voice heard loud and strong and to use your vote wisely.  We have been approached by Paige Peirce and Carrie Wisniewski regarding their quest to be placed on the ballot.  Remember, this […]
Comments Off on FINRA Election For Small Firms

FINRA Launches Retrospective Rule Review

 FINRA recently announced that they will begin conducting a “look back” at their current rules to determine if the rules are meeting their intended objectives. “FINRA believes it is important to look back at its significant rule makings to determine whether those rules and rule sets are meeting their intended investor-protection objectives by reasonably efficient means,” said Robert […]
Comments Off on FINRA Launches Retrospective Rule Review

A World Governed by FINRA

How would other industries would handle playing in a brokers’ world ? Over the years at conferences and cocktail parties I often hear Brokers and BD owners lament about the restrictions placed on them compared to other industries.  Indeed it is a very regulated world in the securities industry and the amount of rules, regulations, reports, […]
Comments Off on A World Governed by FINRA

The Lost Boys

  Is soccer mom or Washington to blame for a lost generation? The stock market roared approval of the fed decision to reduce fiscal stimulus from a whopping 85 Billion per month to a still whopping 75 billion per month.  Wall Street loves low interest rates and borrowing money for free so they can play […]
Comments Off on The Lost Boys

8210 Legal Defense Team on the horizon

The SIPA was recently contacted by a prominent legal firm in New York regarding our willingness to sign a non binding letter of intent regarding services offered by the firm.  Since I have known the lead attorney for years and have actually used him (with success!) in the past I decided to tame my attention […]
Comments Off on 8210 Legal Defense Team on the horizon

SIPA Member Robert Keenan Wins Board Seat!

FINRA announced yesterday that Robert Keenan, owner of St. Bernard Financial and a long time SIPA member has won the small firm seat on the Board of Governors.  Keenan defeated fellow SIPA member and current board member Jed Bandes in a close election. We are proud of the efforts put into this important election and […]
Comments Off on SIPA Member Robert Keenan Wins Board Seat!

Wall Streets Fed Addiction

Its time for rehab  There has been a cat and mouse game being played for the last several months between Ben Bernanke and the Seven Sisters on Wall Street.  Basically the game is played out over a few days each week in which big Ben announces it time to stop giving away free money to […]
Comments Off on Wall Streets Fed Addiction


Make your voice heard!  The race for the small firm seat is underway and all three candidates are busy asking members for your vote.  Sitting governor Jed Bandes is locked in what appears to be a tight race with David Sobel , the head of the Small Firms Advisory Board and newcomer Robert Keenan of […]

Getting Fired or Quitting Wall Street?

This is a must see episode of Side Bar with Bill Singer if you are a broker.   Bill talks candidly with Attorney Robert Herskovits about the perils of just quitting your job and taking a new one.  We have chronicled the broker plight before and Bill and Robert give some excellent advice on how […]
Comments Off on Getting Fired or Quitting Wall Street?


  Brokers Beware   With each passing year retired Americans have felt the squeeze of the artificially lowered interest rates that have been crippling this country without so much as a whimper from AARP and its lobbyist friends.  Years ago, many Americans would work their whole life and save up a couple hundred thousand and […]

FINRA Finally Protecting Brokers

John Thomas case could set precedent  FINRA recently came out with a scathing and lengthy complaint against John Thomas Financial and its principals, including its owner Tommy Belesis.  While most of the charges were ugly to say the least however the part of the complaint that really caught my eye was the fact that JTF […]
Comments Off on FINRA Finally Protecting Brokers

SIDE BAR with Bill Singer

New series brings long overdue exposure to Wall Street problems   Noted securities attorney, blogger, SIPA friend and Forbes contributor Bill Singer has recently launched a new interview series in conjunction with Reuters news that is tackling problems often swept under the rug or never mentioned by todays media..  Over the years Bill has been a […]
Comments Off on SIDE BAR with Bill Singer

A Reminder for Small BDs Facing FINRA Fines: Size Matters

 Last month, FINRA reported two unrelated settlements of disciplinary actions against member firms noting its imposition of lower fines after taking into consideration, among other things, each firm’s limited revenues and financial resources.  Indeed, FINRA reported 13 similar settlements in 2012.  Back in 2006, NASD modified the General Principles Applicable to All Sanction Determinations portion […]
Tags: , , , , , Comments Off on A Reminder for Small BDs Facing FINRA Fines: Size Matters


The numbers below came directly from the FINRA web site and quite frankly, its a depressing snap shot of the state of the brokerage industry.  There are many reasons why so many firms are out of business and this is not intended to just blame regulation.  We have endured one of the worst economies in decades and the […]

Comp Rule Puts FinraBetween Broker and Client

 By  Dock Treece With 2013 barely underway, Finra has wasted no time in proposing onerous new rules and regulations for member firms. One such rule was recently released for comment with Regulatory Notice 30-32, the so-called “broker compensation rule.” Essentially the firm introduces a new requirement for registered representatives who are recruited away from one […]
Comments Off on Comp Rule Puts FinraBetween Broker and Client


UNITED STATES OF AMERICA before the SECURITIES AND EXCHANGE COMMISSION  SECURITIES EXCHANGE ACT OF 1934 Release No. 68651 / January 14, 2013 Admin. Proc. File No. 3-14390   In the Matter of RICHARD L. GOBLE  ORDER DISMISSING PROCEEDING   I.   Richard L. Goble, the founder of North American Clearing, Inc., formerly a broker-dealer registered […]

Comment needed for latest FINRA proposal

 Your voice does count but only if you use it.   FINRA recently proposed the following rule to members:   Regulatory Notice 13-02 FINRA Requests Comment on a Proposed Rule to Require Disclosure of Conflicts of Interest Relating to Recruitment Compensation Practices  Comment Period Expires: March 5, 2013 Executive Summary Many member firms offer significant […]
Comments Off on Comment needed for latest FINRA proposal

Broker Protection Reform Needed

Its time to protect the reps from theft  On a monthly basis it seems we read another story about how the owner of a B/D shut his doors, filed a BD withdrawal and then decided to keep last month’s entire production and not pay out their brokers.  In a recent case a Firm owner from […]
Tags: , , , Comments Off on Broker Protection Reform Needed

A New Way to Steal Client Money

How FINRA and Merrill Lynch now define theft   Every month I peruse the monthly disciplinary actions for two reasons. First to see what the trend of actions currently is and secondly to see if I know any of the firms or people who are being named.  This month was no different but one case in […]
Tags: , , Comments Off on A New Way to Steal Client Money

Fiscal Cliff or Emperors New Coat?

 Wall Street continues to control Washington As the press reports on this fairy tale called a fiscal cliff, I can’t help but be reminded of the famous children’s tale about an Emperor who ordered the greatest coat in the history of mankind to be made for him.  As the emperor proudly marched down the streets […]
Tags: , , , , Comments Off on Fiscal Cliff or Emperors New Coat?

A Lesson in Pink

A walk to remember I recently was coaxed (told) by my wife to take part in a 5k walk for Breast Cancer Awareness in downtown Orlando.  October is breast cancer awareness month and if you are a fan of the NFL you notice players wearing pink wristbands, shoes and ribbons all over their body.  For […]
Comments Off on A Lesson in Pink

Clearing Firms Replacing FINRA

  Small firms being squeezed out In 2006  the NASD announced they were going to merge with the NYSE and eliminate the one firm one vote rights of over 5000 brokerage firms in the United States.  While some ushered in the idea of a public dominated board, others cautioned that without one firm one vote, […]
Comments Off on Clearing Firms Replacing FINRA

Merrill Lynch Rules

FINRA Fines Merrill one day of interest for five years of violations Today FINRA announced that they have fined Merrill Lynch $500, 000 for five years worth of violations related to their failure to timely update broker and firm records to reflect customer complaints and arbitrations. In the Merrill Lynch case, FINRA found that: From 2007 […]
Tags: Comments Off on Merrill Lynch Rules


            T-BONE Lessons from George Costanza   Long ago I learned that literally all lessons in life can somehow be related to either the “Godfather” or in some strange way “Seinfeld”.  Over the past year small firms have been flooded with hate spewing e-mails that seem to obsess about the […]
Comments Off on T-BONE!


Market cap losses now exceed over 50 billion  A little less then two months ago we wrote a story known as “ FACEBOOK FOLLIES” and openly criticized the impending public offering and wondered why this huge scam was being allowed to be perpetuated on the American public.  Here we are two months later and the […]


Silver lining not seen by all Recently some groups and supposed champions of the membership were shocked by the various fees that were increased by FINRA as a result of a large loss.  I’m not sure why you would be shocked by this when the CEO of FINRA, Rick Ketchum announced in April that there […]


 Candidates bring solutions to the table The Financial Services Exchange (FSX) once again was the only small firm advocate that was willing to hold an open and candid debate of the candidates for FINRA’s small firm position and just like past years, they asked members of the SIPA to help out.  When Judy Ensweiler of […]


A small firm seat on FINRA’s Board of Governors will be up for election soon and the petition process has begun.  The nominating committee chose to nominate W. Dennis Ferguon for the mid sized seat and some guy named Seth Waugh of Deustche Bank.  We have no idea who Seth is but we have known […]


  IPO could become one of the greatest scams  Today is the day we all have all been told we are waiting for: The Facebook IPO!  Investors around the world will line up to get shares of the social media giant in the aftermarket and will no doubt see dollar signs in their eyes. The […]