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California Securities Lawyer Update: FINRA Releases 2018 Regulatory and Examination Priorities Letter

By George C. Miller, Esq. of Shustak Reynolds & Partners, P.C. posted on Monday, February 12, 2018.

Each year, the Financial Industry Regulatory Authority (FINRA) outlines its core areas of focus through its annual Regulatory and Examination Priorities Letter. This year’s letter highlights a number of longstanding areas of focus, including fraud, suitability, anti-money laundering and private placement investments, as well as several new categories. Here are FINRA’s top priorities for 2018: Read More

California Financial Services Law Report- The Growing Trend: Brokers Moving From Major Wirehouses To Independent Broker-Dealers

By Erwin J. Shustak, Esq. of Shustak Reynolds & Partners, P.C. posted on Wednesday, January 31, 2018.

The facts speak for themselves. There is a steady and growing trend for brokers to leave one of the remaining four wirehouse firms (Merrill, Morgan, Wells Fargo, UBS) and move to one of the independent broker-dealers (IBD’s), RIA firms or smaller, regional firms. In 2016, the four wirehouses had a net exit of approximately $40 billion of assets leave them for one of the IBD’s and other advisor channels. In 2017, the movement of assets from the wirehouses to the IBD network accelerated dramatically. Approximately $75 billion moved from one of the four wirehouses to one of the IBD’s, a regional broker or an RIA firm. Read More

Morgan Stanley Post "Prexit" (Broker Protocol Exit)

By Erwin J. Shustak, Esq. of Shustak Reynolds & Partners, P.C. posted on Friday, December 15, 2017.

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FINRA Examinations Report Cites Broker-Dealer Cybersecurity Deficiencies

By Jonah A. Toleno, Esq. of Shustak Reynolds & Partners, P.C. posted on Tuesday, December 12, 2017.

On December 6, 2017, the Financial Industry Regulatory Authority (FINRA) released a report on recent findings by it Examination program, citing to key deficiencies in broker-dealer cyber security processes. Read More

Financial Brokers Beware: FINRA Is About To Seriously Reduce The Ability To Expunge Customer Complaints

By Erwin J. Shustak, Esq. of Shustak Reynolds & Partners, P.C. posted on Wednesday, December 13, 2017.

FINRA recently submitted a new proposal to the Securities and Exchange Commission which will greatly narrow, and substantially complicate, the ability of brokers to expunge- or remove- from public records including their FINRA CRD (Central Registration Depository) records and FINRA’s Broker Check, prior customer complaints. Read More

The Broker Protocol Update-Who's In-Who's Out

By Erwin J. Shustak, Esq. of Shustak Reynolds & Partners, P.C. posted on Thursday, December 7, 2017.

As we wind down 2017, there has been a flurry of news over the Broker Protocol which began with Morgan Stanley’s announced departure from the group of over 1,500 financial institutions that have signed onto the Protocol since it was first adopted in 2004 by Smith Barney, UBS and Merrill Lynch. Read More

Brokerage Firms and FINRA Crack Down on Broker Expense Account Violations

By Erwin J. Shustak, Esq. of Shustak Reynolds & Partners, P.C. posted on Monday, December 4, 2017.

In a growing number of high profile cases, often involving major producers and star brokers at major wire houses, the firms and FINRA have adopted a zero-tolerance policy for violations of expense account reporting. These crackdowns involve both firm funds and personal business development accounts (“BDA Accounts”), which are available at most wire houses and are funded with brokers’ pre-tax earnings. What is unusual is both the recent frequency of the crackdowns and the severity of the sanctions involved. Read More

From Bitcoin to Ethereum, The Rise of Initial Coin Offerings Draws Regulatory Scrutiny

By Jake Zindulka of Shustak Reynolds & Partners, P.C. posted on Monday, November 27, 2017.

From Bitcoin to Ethereum, The Rise of Initial Coin Offerings Draws Regulatory Scrutiny The amount of capital raised through initial coin offerings (ICOs) has increased exponentially in just the last year. So far, in 2017, companies have raised over $3 billion compared to approximately $300 million raised between 2014 and 2016.  Read More

San Diego Securities Lawyers: First Morgan, Now UBS Jumps From The Broker Protocol Ship

By Erwin J. Shustak, Esq. of Shustak Reynolds & Partners, P.C. posted on Tuesday, November 28, 2017.

Several weeks ago, Morgan Stanley became the first major wire house to exit the Broker Protocol that Morgan signed back in 2006. Since exiting the Protocol, Morgan already has sought, and obtained, a Temporary Restraining Order from a state court judge preventing that departed broker- who joined Morgan when Morgan still was an active member of the Broker Protocol. Following Morgan’s lead, UBS, one of the initial three signers of the Broker Protocol back in 2004, has announced it also will leave the Broker Protocol by the first of December. Read More

California FINRA Lawyers: The Growing Problem of Unpaid FINRA Arbitration Awards

By Erwin J. Shustak, Esq. of Shustak Reynolds & Partners, P.C. posted on Tuesday, November 14, 2017.

While FINRA arbitrations were intended to provide investors and industry members a quick and relatively inexpensive procedure by which to settle their disputes with member firms, the fact is that a significant portion of FINRA arbitration awards remain unpaid and there is not much that FINRA is able to do about that. Read More