• 21 May 2014 at 2:40 PM

Could Somebody Help A Regulator Out?

The SEC would love to do something about all of those brokers doing all of those bad things and then lying about it while FINRA looks the other way. It really would. But it just doesn’t have the time, by which it means money. So it would really appreciate it if someone, say, FINRA, would step up to the plate and do its job.

Financial advisers need to be examined more often and the Securities and Exchange Commission would need help to do so, an agency official said Tuesday.

SEC Commissioner Daniel Gallagher said that help should come from private firms, such as auditing firms, or from self-regulatory organizations like the Financial Industry Regulatory Authority….

“Given the current resource restraint, there is nothing we can do,” he told reporters on the sidelines at Finra’s annual conference in Washington, D.C. “And we are just asking for something to blow up….”

That is why the SEC should mandate independent third-party examinations for SEC registered advisers, he said.

Well, Commissioner Gallagher, good news: Your pleas have been heard—and heeded—in Hartford.

The Connecticut state legislature has passed a bill aimed at protecting consumers from former securities brokers who have lost their licenses but still continue to sell financial products under the banner of their insurance licenses.

The legislation, which still has to be signed into law by the state’s governor, would require the state’s banking commissioner to provide monthly to the state’s insurance commissioner the names of people with current securities licenses. It would also require the banking commissioner to provide the names of those who have had their registrations denied, suspended or revoked within the past 10 years.

SEC Official: Advisers Need More Scrutiny From Finra, Auditors [WSJ]
Connecticut Passes Bill Requiring Information Sharing on Ex-Brokers [WSJ]

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