Securities, FINRA & Broker Disputes

FINRA – Questions, Anxiety, and the Unknown

Whether a delicate transition to a new Firm, joining a Registered Investment Advisor (RIA), or a serious 8210 FINRA investigation, IMcP’s FINRA lawyers have years of experience to help you navigate this important and anxious time in your life and your career. Common questions include:

• Will my clients transfer to the new Firm?
• Will my old Firm interfere with the transfer of my clients?
• Will my old Firm seek a TRO?
• Will my old Firm “weaponize” my FINRA U5?
• Can I negotiate my FINRA U5 marking?
• How will FINRA enforcement react to my FINRA U5 marking?
• Will my new Firm support me if the old Firm gets aggressive?
• Can my old Firm really “forfeit” my deferred compensation that I’ve earned?
• What about my promissory note?
• How serious is the 8210 letter FINRA just sent me?

Of course, every circumstance is unique and every client problem is different, but IMcP’s FINRA lawyers lean on years of hard-earned knowledge in steering these issues to a solution, whether by negotiating, cajoling, or litigating.

The Exciting, but Perilous, Decision to Move Firms

IMCP’s Joshua Iacuone is a FINRA litigator and also registered FINRA Arbitrator, and knows the nuances of the FINRA process to help position clients for success. IMcP’s FINRA lawyers have a wealth of experience in transitioning brokers and teams to new Firms, litigating against the old Firms, and helping to address any regulatory hurdles.

With more and more Firms exiting the Protocol for Broker Recruiting, it is all the more important to carefully plan any move to a new Firm, including how, when, and in what manner to transition your clients who wish to join you at the new Firm. FINRA Rule 2010 makes clear that clients should be allowed to follow a broker of the client’s choice without any impediments, slow-playing, or sabotage by the old Firm. Unfortunately, many Firms ignore this rule by “playing dirty” to retain the business. You must be aggressive and push back on these tactics because the longer client transitions drag on, the less AUM you will ultimately transfer, which could seriously ding your compensation and ability to achieve bonuses (such as “back ends”) at the new Firm.

FINRA Regulatory Notice 19-10 and FINRA Rule 2140 further demand that the old Firm provide honest and forthright information about your move, new contact information, and not disparage or defame you in an attempt to retain clients. Perhaps most importantly, you must ensure that the old Firm does not “weaponize” your FINRA U5 to scare clients and Firms away from you as a laundered back-door violation of FINRA Rule 2140, FINRA Rule 2010, and FINRA Regulatory Notice 19-10.

FINRA Arbitration

In the arbitration context, choosing the right FINRA arbitration Panel, and insight about how a FINRA Panel thinks and operates, is critical to success. The FINRA arbitration Panel is your “judge, jury, and executioner.”

As a FINRA arbitrator, Joshua Iacuone has a unique view of how FINRA Panels operate, what resonates, and pitfalls to avoid. He couples and complements that knowledge with his significant experience as a trial lawyer litigating FINRA arbitrations around the country.

The Career-Threatening FINRA 8210 Investigation and OTR

Whether about an alleged outside business activity (OBA), selling-away, or gifts from a client, a FINRA compliance investigation is an existential threat to your career. Indeed, there are few things a broker dreads more than notification that either his Firm, or more seriously, FINRA is investigating a compliance violation. Typically, FINRA will send an 8210 letter for documents, communications, and answers to specific questions. After that, FINRA will most likely ask for an OTR, or “On the Record” interview, that is akin to a deposition.

A broker that takes these investigations lightly is playing dice with his or her career. IMcP’s FINRA lawyers can create a game plan to lead you through this treacherous process.