BROWSE BY TOPIC
- Investments - Private
- Investor Protection
- Investments - Unsuitable
- Compliance Concepts
- Investments - Strategies
- Regulatory Sanctions
- Rules & Regulations
- Bad Advisors
- Bad Brokers
- Boiler Rooms
- Wall Street News
- Terminations/Cost Cutting
- General News
- Donald Trump & Co.
- Big Banks
Stories of Interest
- Sarah ten Siethoff is New Associate Director of SEC Investment Management Rulemaking Office
- Catherine Keating Appointed CEO of BNY Mellon Wealth Management
- Credit Suisse to Pay $47Mn to Resolve DOJ Asia Probe
- SEC Chair Clayton Goes 'Hat in Hand' Before Congress on 2019 Budget Request
- SEC's Opening Remarks to the Elder Justice Coordinating Council
- Massachusetts Jury Convicts CA Attorney of Securities Fraud
- Deutsche Bank Says 3 Senior Investment Bankers to Leave Firm
- World’s Biggest Hedge Fund Reportedly ‘Bearish On Financial Assets’
- SEC Fines Constant Contact, Popular Email Marketer, for Overstating Subscriber Numbers
- SocGen Agrees to Pay $1.3 Billion to End Libya, Libor Probes
- Cryptocurrency Exchange Bitfinex Briefly Halts Trading After Cyber Attack
- SEC Names Valerie Szczepanik Senior Advisor for Digital Assets and Innovation
- SEC Modernizes Delivery of Fund Reports, Seeks Public Feedback on Improving Fund Disclosure
- NYSE Says SEC Plan to Limit Exchange Rebates Would Hurt Investors
- Deutsche Bank faces another challenge with Fed stress test
- Former JPMorgan Broker Files racial discrimination suit against company
- $3.3Mn Winning Bid for Lunch with Warren Buffett
- Julie Erhardt is SEC's New Acting Chief Risk Officer
- Chyhe Becker is SEC's New Acting Chief Economist, Acting Director of Economic and Risk Analysis Division
- Getting a Handle on Virtual Currencies - FINRA
We seek to provide information, insights and direction that may enable the Financial Community to effectively and efficiently operate in a regulatory risk-free environment by curating content from all over the web.
Stay Informed with the latest fanancialish news.
NEWSLETTERS & ALERTS
Broker Risks His Career on a Friendship, And Loses
By Howard Haykin
In 2010, friend GW was appointed as a trustee for the revocable trust of his brokerage client (“MBM”). In his capacity as trustee, GW opened several brokerage accounts away from his FINRA member firm – including 2 accounts with MJA at Wells Fargo Advisors (the “MBM Trust Accounts”).
In 2011, when MJA left Wells Fargo for Merrill Lynch, Pierce, Fenner & Smith, GW moved the MBM Trust Accounts to Merrill Lynch, and MJA continued to serve as the registered rep for the accounts.
Over the next few years, MJA continued the ruse by falsely attesting on branch registration questionnaires that ‘none of his clients were employed by a broker firm that was a FINRA member’.
FINRA COMES CALLING. For unstated reasons, FINRA began an investigation into improprieties related to the handling of the MBM Trust Accounts – specifically to determine whether MJA knew about GW's affiliation with a broker-dealer. Here's what ensued:
- In August 2016, in response to FINRA's request for information, MJA submitted a written statement noting that, "[GW] said he was unemployed at the time the account was transferred. I knew his last place of employment to be [an investment bank] in NYC." MJA added that, "[GW] did not tell me he was a registered representative at another broker dealer."
- Shortly thereafter, MJA’s supervisor at Merrill Lynch interviewed MJA about FINRA’s inquiry. During the interview, MJA admitted to knowing that GW was a registered rep at a particular FINRA member firm and had been for many years, and that he (MJA) knew GW was a registered rep at the time he opened the MBM Trust Accounts. MJA also told his supervisor that GW, who was trustee for the accounts, opened accounts with MJA as broker of record because he "obviously" could not serve as the registered representative for the MBM Trust Accounts at his own broker-dealer.
- The matter was escalated to upper-level management, and within a week, Merrill terminated MJA’s employment.
- In March 2017, MJA provided on-the-record testimony to FINRA and once again lied about his knowing that GW was a registered rep.
- In July 2018, MJA finally admitted to FINRA what he knew about GW.
This case was reported in FINRA Disciplinary Actions for June 2019.