Stockbrokers, or more accurately, their employer brokerage firms are required to report to The Financial Industry Regulatory Authority ("FINRA"), when their stockbrokers are the subject of customer complaints alleging sales practice violations, criminal actions, bankruptcies, or their conduct forms the basis of an arbitration or civil action by a public customer against the broker or brokerage firm in excess of $10,000 or any case that was settled in excess of $15,000.

For example, after May 18, 2009, stockbrokers were required to Read Full Article

Until recently, Clifford Jagodzinski worked at Morgan Stanley Smith Barney as a Complex Risk Officer. Mr. Jagodzinski’s job duties included identifying potential compliance risk issues and enforcing securities law violations.

According to a lawsuit filed in federal court, as part of his officical duties, Mr. Jagodzinski detected that a particular broker, Harvey B. Kadden, was flipping preferred securities in a...

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As early as January 2009, financial publications began to warn investors of the risks associated with Inverse and Leveraged Exchange Traded Funds. According to Morninstar, these funds can be "expensive and extremely risky" and may not be appropriate for all investors.

Indeed, in May 2009, FINRA's Enforcement Department’s Strategic Programs Group conducted an inquiry regarding the sale of inverse, leveraged, and inverse-leveraged Exchange Traded Funds, and subsequently in June 2009, FINRA issued Notice to Members 09-31, reminding firms of:

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Brokerage firm Merrill Lynch, Pierce, Fenner & Smith Inc. has agreed to pay $2.8 million to settle charges by the Financial Industry Regulatory Authority (FINRA) that the firm’s failure to supervise led to overbilling.

From April 2003 to December 2011, Merrill Lynch charged a total of about $32 million in unwarranted fees to roughly 95,000 customer accounts as a result of supervisory failures. The firm has since returned the fees with interest, according to an announcement from FINRA.

Merrill Lynch also consented to be censured as part of a Read Full Article

As a colleague once said:  "if you put them to sleep, you have to wake them up.

However, a New York state court confirmed an $880,000 arbitration award against Merrill Lynch, Pierce, Fenner & Smith Inc. despite allegations that one of the arbitrators repeatedly fell asleep during the hearings.

Judge Joan B. Lobis of the Supreme Court of New York, New York County, held in Baker v. Merrill Lynch that there was no basis to vacate the award for arbitrator misconduct b...

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