SIFMA Says Keep the 12b-1 Fees, Ad Infinitum 

Jul 20, 2007,

By Christina Mucciolo

The securities industry is fighting tooth and nail to save 12b-1 fees. Exactly one month after the June 19 SEC roundtable convened to discuss the fate of 12b-1 fees, the securities industry’s lobby group, the Securities Industry and Financial Markets Association (SIFMA), released its comment letter today. The letter says that 12b-1 fees are a necessary part of doing business, and that abolishing them will harm investors and stunt industry competition....

Spitzer Forms Panel to Clean up NY Regulation 

May 29, 2007,

By Kristen French

In his new role as New York governor, Eliot Spitzer is joining forces with those he used to terrorize—Wall Street chief executives—to modernize financial services regulation in the state, the Financial Times reports. Spitzer is forming a panel with the executives, as well as with lawyers, consumer groups and regulators to streamline regulations and make New York more competitive with London, without sacrificing investor protection. The committee will be chaired by Eric Dinallo, the New York insurance superintendent, and will seek to simplify regulation of insurance companies state-chartered banks and securities dealers. ...

“Merrill Lynch” Rule Dead, But SEC to Ask for Time 

May 14, 2007,

By John Churchill

The SEC isn’t going to fight the March 30 D.C. Court of Appeals ruling that vacated Rule 202, the broker/dealer exemption (a.k.a. the Merrill Lynch rule)—they’re just asking for a little mercy for firms that have to adjust. The securities industry still hopes that the SEC will somehow come up with a new plan to keep the fee-based brokerage account (or something like it) from coverage by the Investment Advisers Act of 1940, which mandates that to offer financial advice, you have to be a fiduciary....

NASD Chair Sees Better Oversight of New Products 

May 14, 2007,

By Kevin Burke

WASHINGTON, D.C. – Speaking at the 49th annual Investment Company Institute general membership meeting, NASD Chairman Mary Shapiro told mutual fund executives she sees better regulation of investment products as a result of the expected merger of the NYSE and NASD regulatory bodies. While this potentially is better news for investors, purveyors of mutual funds may find themselves in the crosshairs when bringing more nuanced products to market....

SEC Fines A.G. Edwards for Failure to Supervise 

May 2, 2007,

By John Churchill

Add A.G. Edwards to the long list of firms that have been fined by the SEC for long-ago failures to supervise brokers who deceptively market timed mutual funds. ...

The Great Reckoning 

May 1, 2007,

BY JOHN CHURCHILL

Oy. What a headache. That's what many Series 7-carrying advisors are saying about the prospect of the end of the Merrill Lynch rule. ...

Pleasing All Masters 

May 1, 2007

Q: I always live by the rule of The Client Comes First. But, sometimes I feel that my bosses are pushing in the opposite direction. What do I do when I feel a product or solution that is not proprietary is a better fit for my client, but my bosses are pushing me to sell our company products for the benefit of the company?...

RIAs, Hedge Funds to Pay Up for Compliance Help 

Apr 25, 2007,

By Kevin Burke

Registered investment advisors, broker-dealers and hedge funds are spending more money on compliance software than ever before. This according to a report released on Tuesday by research firm Celent, which predicts that the U.S. wealth management compliance solutions market will reap $178 million in sales in 2007, growing to $318 million by 2011. The overall market is expected to grow steadily at a 15 percent compound annual growth rate, but the kinds of purchases made and the amount spent by different firms will vary by market segment. ...

After Court Ruling, It’s Back to Business Like It’s 1999 

Apr 4, 2007,

By John Churchill

If you’re like most registered reps these days, you’ve got some portion of your clients in a fee-based compensation arrangement. And, no doubt, you’ve been selling yourself as a full-service, top-to-bottom “financial advisor,” financial consultant, wealth manager or some other such glorified title. (Does anyone’s card read stockbroker anymore?)...

Ex-Merrill Broker Nabbed in Online Gambling Sting 

Mar 29, 2007,

By Kevin Burke

Fairly or unfairly, gambling and strip clubs have always been associated with slick, fast-talking Wall Street brokers. And while most financial advisors would argue that this is nothing more than an unfortunate stereotype, the headlines continue to suggest otherwise....

Don't Mess with Suspension Rules 

Mar 1, 2007,

By Bill Singer

If you are like most working people, you go to the office every day. And, if you like your job, it can even be hard to stay away. But if you get a suspension...

The Unscrupulous Manager 

Feb 1, 2007,

By Ann Therese Palmer

A colleague of mine recently left our firm and the business, asking me to take care of a few of his clients. One client about whom he was concerned happens to be his cousin. My colleague was new to the business, and his manager handled setting up the cousin's retirement plan. ...

Blotter 

Nov 1, 2006,

John Churchill

SEC Busts Another Ponzi: The SEC filed securities fraud charges against Salvatore Favata, the former president of National Consumer Mortgage (NCM), a...

Fighting the U5 

Nov 1, 2006,

By Jacob H. Zamansky

New York's highest court will soon decide whether a brokerage employee can contest the language an employer uses in the Form U5...

A Big Trade Off? 

Nov 1, 2006,

By Susan Konig

When going independent, your payouts rise substantially. But what about your compliance responsibilities?...

Skirts Vs. Smith Barney 

Nov 1, 2006,

Angela Covo

Less than 10 years after they settled the infamous boom-boom room case, Smith Barney is being sued for discrimination again. The new case, Fassbender...

How to Protect Client Assets 

Nov 1, 2006,

By Jason Van Steenwyk

Liquidity claims against professionals, business owners and wealthy individuals are rising. What can you do to help clients minimize risk of losses...

Listen to Your Client 

Nov 1, 2006,

By Ann Therese Palmer

If a client insists on liquidating part of her portfolio, particularly assets that are heavily concentrated, it's very risky to ignore her request...

Secret Agreements with Clients Can Backfire 

Nov 1, 2006,

By Bill Singer

NASD has been watching for brokers and firms who borrow from clients, agree to share losses or settle disputes privately...

Agent or Fiduciary? 

Oct 1, 2006,

By Ann Therese Palmer

The line between brokers and fiduciaries has gotten blurry. When does a broker cross over?...

Creditors Snatch Collection Plate 

Oct 1, 2006,

John Churchill

If you're bankrupt, giving money to a religious institution is not an option, says one court. ...

Mediation Mambo 

Oct 1, 2006,

Halah Touryalai

If you've got legal trouble, October may be your lucky month: It's mediation month. The program of events, sponsored by the NASD, kicks off on Oct. 3...

The Long Arm of NASD 

Oct 1, 2006,

By Bill Singer

In arbitration, the SRO warns you don't have Constitutional protection. But, there are limits...

Deciphering the Rules of Retirement Advice 

Oct 1, 2006,

By John Churchill

Some advisors have long ignored parts of ERISA when consulting participants of 401(k) plans. Now they don't have to. Still, the Street is confused over what the new pension laws really mean when it comes to reirement advice...

Pru Agrees to $600 Million Market-Timing Settlement 

Aug 29, 2006,

By Kristen French

Prudential Equity Group, a broker/dealer subsidiary of Prudential Financial, got slammed Monday with one of the biggest settlements seen in a market timing case: $600 million in fines, restitution and penalties....