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You may have lost money in your investment portfolio,
due to mismanagement and not even know it.

Finra snapshot: Just how widespread is the "bad broker" problem?

There are many hundreds of thousands of registered brokers and financial advisers across the country.

And, of course, not all of them act properly when it comes to money entrusted to their care by clients who are justifiably relying in good faith on their professionalism.

The Financial Industry Regulatory Authority is the arm operating under the auspices of the U.S. Securities & Exchange Commission that oversees many of the country's brokers, with the self-regulating agency reportedly having more than 630,000 financial professionals under its purview.

How many of those individual pose a real problem for investors? That is, how soiled is the profession by unscrupulous actors who take advantage of -- rather than dutifully serve -- clients?

In Finra's estimation, there is no paucity of scammers and outright criminals in the broker profession. The regulatory arm has barred close to 300 brokers nationally in the past few years, and an internal investigatory office referred close to 800 cases potentially involving fraud and insider trading to enforcement groups last year.

And then there's this: At its recently concluded annual meeting, Finra cited "high-risk and recidivist" brokers as its uppermost priority.

A recent article on Finra's increasingly close scrutiny of problem brokers and resulting disciplinary action against them points to general industry approval of a ramped-up approach toward bad actors. Notwithstanding broker-dealers' support, though, many industry voices are calling for greater clarity regarding what constitutes broker bad faith and high-risk conduct.

Likely, that is coming, with Finra investigators pointing to their progressive use of more refined data and analytics in uncovering problematic behaviors.

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