Is Supreme Court Leaning Towards a Decision Against Broker? 

Jan 19, 2006

The Supreme Court heard arguments yesterday in connection with a suit by a former Merrill Lynch broker against the nation’s largest brokerage firm, and the early reaction to the hearing is that this time Goliath won....

NASD Enforcer Departing for the Dark Side 

Jan 18, 2006,

By John Churchill

Barry Goldsmith, the NASD’s executive vice president for enforcement, is headed over to the dark side. Goldsmith will be leaving the regulator in March for private practice at the Washington, D.C.-based law firm Gibson Dunn & Crutcher. He will be replaced for the time being by the department’s deputy head, James Shorris....

Registered Rep. Is Taking Outstanding Advisor Award Nominees 

Jan 18, 2006,

By David A. Geracioti

We, the editors of Registered Rep. magazine, are officially opening our annual hunt for the best in the business. ...

SEC Displays Enforcement Commitment in Leveling Record Penalty 

Jan 13, 2006,

By Halah Touryalai

Daniel Calugar, a former Las Vegas stock trader, settled with the SEC regarding charges that involved market timing and late trading of mutual funds. The settlement will require him to pay a record $153 million in penalties....

UBS Dinged $50 Million for Market Timing 

Jan 12, 2006,

By John Churchill

New York Stock Exchange Regulation, along with the New Jersey Bureau of Securities, today announced that UBS Financial Services was fined $49.5 million for failure to supervise the deceptive market timing activities of its brokers....

Schapiro in for Glauber at NASD 2007 

Jan 12, 2006,

By John Churchill

The NASD Board of Governors announced today that Mary Schapiro, currently the self-regulator’s head of Regulatory Policy and Oversight, will become the NASD’s chairwoman when the term of its current chief, Robert Glauber, ends in December 2006....

Ed Jones, AG Edwards, Baird: Great to Work For 

Jan 9, 2006,

By Kristen French

Three regional brokerage firms made Fortune magazine’s top 100 companies to work for this year: Edward Jones, AG Edwards, and Robert W. Baird...

NASD Mistakenly Failed Nearly 2,000 Aspiring Brokers Who Took Series 7 Last Year 

Jan 6, 2006,

By Halah Touryalai

Talk about an embarrassing blunder: Aspiring brokers who took and failed the Series 7 exam between Oct. 1, 2004 and Dec. 20, 2005 may have passed the test after all. The NASD reported today that it is notifying 1,882 individuals that they wrongly received failing grades as the result of a software error. The error only affected test takers whose grades were on the cusp of the pass/fail line, which is 70 percent. Over 60,000 people took the exam during the period, and of the 1,882 who received incorrect grades, over 1,000 of them have already re-taken the exam and passed....

Merrill Funds To Change Name 

Dec 27, 2005,

By Stan Luxenberg

Like many brokers that sell their own mutual funds under their own name, Merrill Lynch has been struggling to drum up sales. In the latest move, the Wall Street giant announced that it intends to change the name of Merrill Lynch Investment Management’s funds to—well, that has yet to be determined and won’t be until sometime in early 2006. (Morgan Stanley, with $430 billion under management, also recently announced that it was rethinking its name.) Some speculate that it’s just one way to gussy up Merrill Lynch Investment Management for its eventual sale (all or part). ML, of course, won’t comment, but it’s no secret that Merrill did explore the idea of spinning off MLIM and retaining a minority stake. ...

For Morgan Retail, Fourth Quarter a Mixed Bag; More Purcell Directors Resign 

Dec 21, 2005,

By Kristen French

The fourth quarter brought mixed news for Morgan Stanley’s retail brokerage, which is struggling to turn itself around post-Phil Purcell. Pretax earnings soared 65 percent to $84 million on net revenue of $1.3 billion (21 percent better than a year ago). But pretax operating profit margins sank to 7 percent, from an average of 8.9 percent for the previous three quarters of the year. Meanwhile, total client assets declined by $2 billion to $617 billion, but client assets in fee-based accounts increased by $3 billion, or 2 percent, to a record $173 billion....

Broker Cleans Up Millions From Dirty Campaign Charges 

Dec 20, 2005,

By Halah Touryalai

A broker won nearly $10 million from his former employer, Waddell & Reed, last week—six years after first suing the broker/dealer for smearing his reputation and eight years after being fired in the wake of his testifying against the firm at an SEC hearing....

Former Pru Broker Penalized for Abusive Trading 

Dec 16, 2005,

By Halah Touryalai

Three years after the SEC charged five Boston-based Prudential Securities brokers for abusive mutual fund trading, one of the accused is being temporarily barred from association with any broker/dealer or investment advisor....

Court to NASD: You Don’t Have a Leg to Stand On 

Dec 15, 2005,

By John Churchill

For the first time in its 68 years as a self-regulatory organization, the National Association of Securities Dealers sued the Securities and Exchange Commission over a right it was never granted. Guess what? It lost. ...

NYSE Regulators to Member Firms and Reps: We Are Watching You 

Dec 14, 2005,

By David A. Geracioti

Broker/dealers had a very strong 2005. But so too did the regulators. According to Susan Merrill, chief of enforcement for the New York Stock Exchange Regulation, 2005 was a “landmark year for enforcement.” In a “year-in-review” presentation for financial reporters Wednesday morning, Merrill and other top officials from NYSE Regulation ticked off a litany of successes on the regulatory front, from revenue sharing disclosures, to prospectus delivery, to “disruptive” trading and other malfeasance. ...

LPL Deal Signals Seller’s Market for B/Ds 

Dec 1, 2005,

By Halah Touryalai

It is by now old news that Linsco/Private Ledger sold a 60 percent stake in itself to two private equity firms in late October, after years of talk about taking the firm public. The deal values LPL at $2.5 billion, a very nice price indeed: The two PE firms paid around 2.5 gross revenues, a high multiple by historical standards. Mergers and acquisitions experts say it offers proof that it’s a seller’s market for independent broker/dealers. Moreover, many more b/d deals are on the way, they say....

Wachovia Shaves Payout, Levels Charges on In-House and Outside SMAs 

Nov 30, 2005,

By Kristen French

After vastly simplifying it’s payout structure earlier this year, Wachovia Securities announced in a memo to brokers Tuesday that it would make some more tweaks in 2006 and raise ticket charges on some in-house money management products to match those of third-party products....

Mom-and-Daughter Team Wins $2 Million Arbitration Over Sex Discrimination 

Nov 23, 2005,

By Kevin Burke

A mother-daughter broker team won a $1.98 million sex-discrimination arbitration award from Merrill Lynch, as the brokerage giant got dinged—again—for allegedly mistreating its female reps....

For Merrill and Smith Barney Acquisitions, It’s Wait n’ See 

Nov 22, 2005,

By John Churchill

Merrill Lynch and Smith Barney—both set to close their respective acquisitions of Advest and Legg Mason on Dec. 1—continue to see the booty they bought walk out the door. The purchases would have added hundreds of regional brokers to their retail brokerage units, but many of these brokers have decided they don’t want to work for a big firm and are finding sweet recruiting deals at smaller shops....

Smith Barney Cuts Pay for Smaller Brokers 

Nov 18, 2005,

By Kristen French

Smith Barney plans to trim payouts for lower-end brokers next year, in an effort to counter rising costs and cull underperformers from its ranks. The new pay scale was announced to brokers internally in October and will take effect in January....

Schwab Fined $1 Million for Lax Oversight of Non-Employee RIAs 

Nov 15, 2005,

By Kevin Burke

Charles Schwab’s brokerage unit has been slapped with a $1 million fine for failing to protect customer assets from a check-kiting scam engineered by its affiliated—but independent—registered investment advisors....

For Advest Reps, Clock Is Ticking 

Nov 14, 2005,

By John Churchill

With only two weeks left before Merrill Lynch closes its deal to buy Advest Group—the deal is scheduled to close on Dec. 1—top reps at the Hartford, Conn.-based firm continue to run for the exits. This past weekend another $8 million in production decamped for other firms....

Cox to SIA: No Regulatory Rollback 

Nov 11, 2005,

By David A. Geracioti

When William Donaldson stepped down as SEC chairman, the perception was that the reform movement had also left the building. The White House replaced him with California Congressman Christopher Cox, known for his anti-regulatory rhetoric. But in his first speech to the Securities Industry Association today, Cox delivered a strong message: “The guns of the SEC are not about to go silent.” Cox said pirates may no longer sail the waters off Boca Raton, Fla.—where the SIA annual meeting is being held—but “today’s pirates sail the seas of high finance.”...

News From the SIA Meeting 

Nov 10, 2005,

By David A. Geracioti

The top executives of the nation’s biggest securities firms have gathered once again at their annual meeting, and declared that 2005 will go down as one of the industry’s best years ever. Profits of the 600 Securities Industry Association member firms are expected to jump by more than 14 percent, to $23.7 billion this year, on a revenue increase of 32 percent (to an estimated $314 billion). And employment at financial services firms jumped by 14.9 percent in the past year, the Bureau of Labor Statistics reported. (But advisors take note: Retail jobs declined by 1.3 percent.)...

Morgan Stanley Waves Baby Carrot at Sales Assistants 

Nov 10, 2005,

By Kristen French

As Wall Street traders and investment bankers lick their chops at the prospect of six- and seven-figure bonuses next month, Morgan Stanley has decided that sales assistants should get a taste of corporate largess. It won’t put anybody behind the wheel of a “Beemer,” but the brokerage announced plans to bump up the 2006 raise pool to 3.5 percent from 3 percent, and will offer an additional 5 percent to some underpaid SAs, starting in December....

One Weird Termination Case: “Decorated” Pru Broker Wins Wrongful Termination Suit 

Oct 31, 2005,

By Kristen French

The day he was fired from then-Prudential Securities—July 25, 2001—is a day Bob Ostrowski says he will never forget. But he says he's ready to start trying: Ostrowski was awarded $2 million from Prudential for wrongful termination in a New York Stock Exchange arbitration proceeding Wednesday. ...