March 26, 2016
On March 24, 2016, the United States Department of Justice announced the unsealing of an Indictment in the United States District Court for the Southern District of New York naming seven individual defendants who allegedly served as hackers in the employ of ITSec Team and Mersad Company, which were computer security companies working on behalf of the Iranian government (including the Islamic Revolutionary Guard Corps). The synopses in the press do not do the Indictment justice. It is an unsettling and scary reminder of how vulnerable we are in the cyberworld. The fact remains that it's not that difficult for someone with a will to find a way to defeat the best attempts to erect an online wall between the good guys and the bad guys -- which raises yet another provocative question as to how we discern the good from the bad these days. READ
You had your day in court. You lost. You didn't plead guilty to the criminal charges but chose to throw the dice at trial. Unfortunately, a jury convicted you. Now imagine that you were in the brokerage or investment advisory business and the underlying crimes involved frauds involving your advisory role and financial institutions. How difficult do you think it would be for the Securities and Exchange Commission to bar you from the biz? How long a process do you think would be involved? Today's BrokeAndBroker.com Blog might surprise you. READ
When I was a much younger man and doing two stints in the 1980s as a lawyer with Wall Street self-regulatory organizations, I would find in my in-box matters involving alleged Net Capital violations. As best I can explain it, ya got yer sexy regulatory matters like insider trading, unsuitability, and elder fraud; and then ya got yer bone-numbing, boring regulatory matters like Books-And-Records and Net Capital. The sexy stuff is, relatively speaking, fun to handle. The bone-numbing stuff, as the term suggests, tends to elicit an "oh crap" response and little more than unhappy resignation to find yourself investigating and perhaps prosecuting such violations. Given those factors, some SEC regulators and federal prosecutors sort of lucked out when a combination Books-And-Records and Net Capital matter mushroomed into a criminal case replete with the oddball facts that could only put a smile on the face of a hardened regulator and prosecutor. It ends with a prison term. READ Wall Street Employee Fined And Suspended For Being In 2 Places At Same Time
We often admire folks who hold down more than one job. On Wall Street, however, admiration for such a hard-worker isn't always the first reaction. Your brokerage industry employer may insist that you only work for that firm, and that firm alone. If you were to ask why, the explanation might be that it's a compliance policy and a regulatory rule. Sure, you could seek permission to engage in the so-called outside business activity at another employer, but you first need to submit a prior written request to your Wall Street employer. At some firms, the answer is simply and routinely "NO;" and other industry employers may subject you to difficult limits. In light of such compliance and regulatory policies, some industry employees inadvertently run afoul of the rules,and others, well, what can I say, ya got yer bad apples in every industry. A recent FINRA regulatory settlement involving an individual who may (or may not) have been holding down two jobs leaves us scratching our heads. Maybe something wasn't done properly by the employee or maybe FINRA itself is confused. It doesn't help that the written settlement was published in a manner raising more questions than providing answers. READ
