Richard G. Ketchum, Chairman and CEO of FINRA, appeared before the securities industry trade group SIFMA at its Complex Products Forum on September 27, 2012 in New York to admonish brokerage firms about the perils and obligations involved in marketing complex investment products to investors. According to Ketchum, while there is no legal definition of […]
A Selective Overview of Provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act
Reasons for the Act Inspired by the financial meltdown of 2007-2010 Home market collapsed: total home equity in US dropped from $13 trillion in 2006 to $8.8 trillion by mid-2008, foreclosures Over 100 mortgage lenders went bankrupt in 2007-08 Money market funds experience mass withdrawals ($144.5 billion in a week, compared to $7.1 prior week) […]
If You Want More Fraud, Try Cutting The SEC’S Budget
The SEC’s budget is the topic of hot debate, with SEC Chair Mary Schapiro begging Congress not to make further cuts to the agency that is charged with policing our securities laws. It is distressing to contemplate that this is even up for discussion at a time when investors are still climbing out of the […]
Wells Fargo Settles SEC Claims that Wachovia Sold CDOs to Indian Tribe at Inflated Prices in 2007
The SEC announced on April 5, 2011 that Wells Fargo Securities agreed to a multi-million dollar settlement of charges that one of its units, Wachovia Capital Markets (which is now a part of Wells Fargo), committed securities fraud when it sold the Zuni Indian tribe complex securities known as collateralized debt obligations (CDOs) which are […]
Regions Morgan Keegan Bond Funds
Smiley Bishop & Porter LLP has represented a number of individual and institutional investors who bought shares of Morgan Keegan’s RMK High Yield Bond Funds. RMK Funds were marketed as low risk investments, despite a high concentration in subprime mortgage-backed securities and collateralized debt obligations. A particular problem was that the funds invested in low […]
FINRA CEO Expresses Concerns About Investment Products
Rick Ketchum, Chairman and CEO of the Financial Industry Regulatory Authority (FINRA), recently spoke at the CCOutreach BD National Seminar. Ketchum addressed some specific product concerns: Over the last couple of years, FINRA has issued a number of Regulatory Notices related to products that have raised concerns for us from an investor protection standpoint. As […]
Arbitrator Out of Work? Call FINRA
Wall Street Journal cites Brian Smiley on FINRA’s efforts to recruit arbitrators to handle Morgan Keegan claims. Wall Street needs an army of arbitrators to clean up the mess left by the headline-grabbing collapse of three mutual funds stuffed with collateralized debt obligations and other subprime-related securities.
Selling Toxic Debt to Seniors
Business Week quotes Brian Smiley on toxic debt in bond funds sold to seniors. The subprime securities that created carnage on Wall Street are bringing new pain to Main Street. Regulators in five states are investigating whether Memphis brokerage Morgan Keegan failed to disclose the risks of seven mutual funds stuffed with toxic debt and […]
