BROWSE BY TOPIC
- Bad Brokers
- Compliance Concepts
- Investor Protection
- Investments - Unsuitable
- Investments - Strategies
- Wall Street News
- Investments - Private
- Rules & Regulations
- Bad Advisors
- Boiler Rooms
- Terminations/Cost Cutting
- General News
- Donald Trump & Co.
- Big Banks
- Regulatory Sanctions
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
Brokers vs. Broker-Dealers: Is Ownership of Client Relationships Still a Hotly Debated Topic?
by Howard Haykin
While the broker admitted to possessing the information, he explained that ... the information was put on a memory stick by MetLife during his tenure with that firm so that he could move info between work computers. Upon leaving MetLife in 2016, the broker took the memory stick since it also contained the files he brought to the firm – forgetting that protected information was also on it. One year later, when he came across the protected information on the stick, the broker used it to contact ‘orphaned’ MetLife customers – an action that apparently violated Regulation S-P.
OWNERSHIP OF A CUSTOMER/CLIENT RELATIONSHIP. Contrary to what I initially anticipated, this case had little to do with a battle for ownership of customer/client relationships - i.e., a tale of "David and Goliath," whereby giant MetLife Securities would seek to crush this lone broker warrior, who has 18 years' experience and no prior disciplinary disclosures on his CRD records. Nevertheless, the case brought to mind many past battles that broker-dealers waged against their ex-brokers - leading me to wonder whether The Protocol for Broker Recruiting had resulted in an amicable peace arrangement.
The arrangement appears to have been good for the industry as a whole. Though not all broker-dealers (BDs) and registered invetment advisers (RIAs) are party to the Broker Protocol, and brokers are restricted as to what client information they may bring to their new firms, by and large ... (i) brokers have retained their client base; (ii) client investments have not been caught up in litigation; (iii) smaller firms have been able to successfully compete against larger firms; and, (iv) the incidence of lawsuits has diminished. Yet, Morgan Stanley, Citibank, UBS and other smaller firms have withdrawn from the Broker Protocol, leading to an increase in the filing of temporary restraining orders, or TROs, to prevent ex-brokers from contacting their clients. [NOTE: Given the complexity of this issue, please refer to further discussion in other publications - see list below.]
[For further details on the above case, click on … FINRA Case #2018058852901.]