Joshua is co-editor and a frequent contributor to Securities Compliance Sentinel, a blog that provides analysis of cutting-edge securities industry issues.
Scroll down to see Joshua's most recent posts.
Recent Blog Posts
- Compliance Issues The SEC Is Seeing The Office of Compliance Inspections and Examinations (or OCIE) recently issued a Risk Alert that identified the five most frequent compliance topics that arising from OCIE examinations. These compliance topics include the following: Deficient compliance programs, Late or insufficient filings, Violations of the custody rule, Code of Ethics compliance deficiencies, and Books and records. Among other things, OCIE noted that it continues to see untailored “off-the-shelf” manuals, deficient or non-existent annual reviews, as well as the systemic failure to follow procedures. So what does this all... More
- One Man’s Rogue Broker Is Another Man’s Treasure Like it has in the past, FINRA is sharply focused on examining brokers with a disciplinary past, including the identification and examination of such brokers being placed at the top of its 2017 exam priorities. Does this mean that firms cannot hire brokers with a past? The short answer is no, but the longer is a bit more involved. A FINRA examination team is going to be conducting a quantitative analysis to review the broker’s test scores, number of prior employers... More
- What Do You Need To Know About New York And Cybersecurity? On March 1, New York will go live with cybersecurity rules for financial service providers such as banks, insurance companies and others subject to the Department of Financial Services’ jurisdiction. At its core, the rules require these entities to have cybersecurity programs directed to consumer protection. New York firms must now have written policies and procedures, as well as a designated chief information security officer to oversee, train, enforce the program and report hacking to the state. Any report of hacking... More
- What’s the Deal with Data Breach insurance? A recent Investment News article highlighted a burgeoning market for financial advisors looking to protect their practices; namely, data breach insurance. Although such insurance seems like a great idea, you need to exercise due care when purchasing such insurance. According to the article, more and more firms are buying this insurance to supplement any gaps that may exist in regular D&O insurance. After all, the typical D&O insurance policy either does not cover or provides little coverage for the harm caused... More
- What are you doing to prevent a data breach A broker-dealer recently agreed to pay a $650,000 fine after an OSJ’s cloud vendor failed to adequately protect customer information. Apparently, an outside hacker was able to gain access to non-public personal information about the firm’s customers. This breach and resulting fine should certainly serve as a wake-up to all firms, but, in particular, to smaller firms. These firms are those who are more likely to use outside vendors to maintain cost, but are at greater risk. If anything, this fine only... More
- Dodd What Now that the election is over, it remains to be seen whether a Trump administration will do away with Dodd-Frank and dump the Department of Labor fiduciary duty rule as promised. Come inauguration, all bets are off. The one thing for certain is that the world for securities professionals will surely be changing come January. Hold on for the ride.... More
- So Who Wants Senior Clients In its never-ending effort to thwart senior investor fraud, FINRA recently proposed a new rule to the SEC. This proposal would require member firms to obtain the name of a trusted contact person for the customer’s account. The new rule would also allow firms to place temporary holds on the disbursement of funds or securities when there is a reasonable belief of exploitation, and notify the trusted contact of such a hold. This proposed rule is consistent with the advice I... More
- A Data Breach! You Better Check The Law Of The States In Which You Have Customers Consistent with the ongoing guidance/requirements from the SEC and FINRA, all firms must have and enforce data security policies and procedures. Even the best policies and procedures may, however, not protect the firm in every instance. So what do you do if there is a breach? One of the most important things to determine is what law governs. In other words, if you have clients in all 50 states, it is possible that there are 50 different data breach laws that... More
- When just saying “no” is a good thing In the hectic world of financial services, registered representatives and investment adviser representatives are always looking to increase their assets under management. At what cost? Are there situations where you would be better off just saying no to accepting that one additional client? In my many years of defending representatives and advisers from customer complaints, the unqualified answer is yes; there are situations when you are better off just saying no. Any good risk avoidance program will provide for the proper... More
- Do you really want to hire that broker with a checkered past That is the question that the SEC has essentially posed for registered investment advisers in a National Exam Program Risk Alert. In doing so, the SEC has stated that it will be “examining compliance oversight and controls of registered investment advisers that have employed or employ individuals with a history of disciplinary events . . . .” The SEC will essentially be examining the investment advisers business and compliance practices, particularly focused on higher risk individuals. Does this mean that you... More