Articles Posted in AWC

The Financial Industry Regulatory Authority (FINRA) recently sanctioned First Trust Portfolios L.P., a Wheaton, Illinois-based securities wholesaler, imposing a $10 million fine for serious violations involving non-cash compensation and misleading reporting. This enforcement highlights underscores the importance of strict compliance with gift and entertainment rules in the securities industry.       I.            Background First Trust has operated as a wholesale distributor…

Summary: FINRA Disciplinary Action – Kenneth John Malm On May 20, 2025, FINRA released an AWC for Matter No. 2023078405601. Background: Alleged Violations: Sanctions: Additional Notes: Conclusion:Malm’s case highlights FINRA’s strict stance on conflicts of interest and the importance of disclosure and firm approval when it comes to bequests from clients. Malm’s alleged failure to…

FINRA recently published an AWC entered into with Richard L. Langer, a registered representative with Planner Securities LLC. FINRA accused Langer of violating FINRA Rules 2210 and 2220. FINRA Rule 2210 governs communications by registered representatives with the public and FINRA Rule 2220 sets forth requirements with respect to options-related communications. The review of Langer’s…

Since 1972 the Securities & Exchange Commission (the “SEC”) has maintained a rule that imposes a gag order on settling defendants in civil enforcement actions. In 2003, Barry D. Romeril, CFO for Xerox, entered into a consent agreement with the SEC that included the following language: “Defendant understands and agrees to comply with the [SEC]’s…

When settling a FINRA investigation, the Staff drafts a letter of Acceptance, Waiver and Consent (AWC) setting forth the terms of the settlement. In the AWC, FINRA routinely demands the settling party consent to the following restraint on speech: “Respondent may not take any action or permit to be made any public statement, including in…

This is a classic case of buyer’s remorse. In the case at hand, FA Jeffrey Mohlman settled with FINRA by executing a letter of Acceptance, Waiver and Consent (called an AWC) and, in so doing, agreed to a bar from the securities industry. Apparently displeased with his decision, he filed an action in court seeking…

FINRA wants a member firm to enforce its written supervisory procedures. And FINRA wants a member firm to recommend securities that fit within the customer’s investment objectives. And certainly FINRA wants a member firm to avoid falsification of business records. So what happens when a member firm doesn’t quite live up to FINRA’s expectations? Let’s…