FINRA NAC

GAG ORDERS USED BY FINRA UNDER REVIEW BY SCOTUS

April 19, 2022 | Herskovits, PLLC

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When settling a FINRA investigation, the Staff drafts a letter of Acceptance, Waiver and Consent (AWC) setting forth the terms of the settlement. In the AWC, FINRA routinely demands the settling party consent to the following restraint on speech:

“Respondent may not take any action or permit to be made any public statement, including in regulatory filings or otherwise, denying directly or indirectly, any finding in this AWC or create the impression that the AWC is without factual basis.”

A matter before the U.S. Supreme Court may upend FINRA’s use of a gag order.

FINRA Disciplinary Proceedings – Inside FINRA’s Complaint and Hearing Process

August 5, 2017 | Herskovits, PLLC

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FINRA’s enforcement program is big business.

In 2008, FINRA levied fines totaling $28 million. By 2016, that number jumped to $176 million. In 2008, FINRA ordered restitution payments to investors totaling $6 million. By 2015, that number jumped to $96 million.

Each year, FINRA initiates approximately 1,500 disciplinary actions against member firms and employees. FINRA’s Office of Hearing Officers resolves approximately 400 proceedings per year.

Cal-based Representative Jim Seol Barred by FINRA – Failure to Disclose $100 Million in EB-5 Investments to Employer

July 24, 2017 | Herskovits, PLLC

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In its quest for investor protection and market integrity, FINRA diligently seeks out firm representatives who are in violation of its strict rules. Recently, the regulatory authority decided to bar California-based Jim Jinkook Seol from the industry.

A former employee of Ameriprise Financial Inc.; Seol was found to have sold $100 million worth of EB-5, permanent residency-eligible, investments without disclosing the transactions to his employer.

The EB-5 visa program offers permanent residency to foreign nationals who invest between $500,000 and $1 million and create 10 jobs in a new business venture in the US. The program is especially attractive to wealthy individuals from emerging economies like China and India, and, as such, it holds an enormous profit potential for securities industry professionals.

FINRA DISCIPLINARY ACTIONS – JUNE 2012 UPDATE

June 19, 2012 | Herskovits, PLLC

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FINRA issued its summary of disciplinary actions reported for June 2012. Certain actions are noteworthy and are indicative of regulatory trends effecting broker-dealers and registered representatives.

Herskovits PLLC comments on the following regulatory actions:

Net Cap Violations