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Mar 2, 2009 5:37 pm

Did you know that you cannot retire for at least 6 years after you decide to get out of this business?

  Did you know that FINRA lists you as an employee?   Did you know that you fall under all guidelines and regulations of the IRS, FICA, and Department of Labor that qualifies you as an EMPLOYEE?   Did you know that we are the  only industry in the United States that allows employees to be sued for negligent or accidental acts?   Did you know that FINRA created their own regulatory body that supersedes the CIVIL Jurisdiction of this country?   Did you know that the statute of limitations of for any action is 5 to 6 years?   Did you know that your E & O policy is most likely a Claims Made Policy which means you have to keep your policy or a policy for at least 5 to 6 years after you retire?  
Mar 2, 2009 5:46 pm

Who are you talking about?  And who ARE you?

Mar 2, 2009 6:18 pm

All registered representatives.  I have been in this business 25 years.  series 7 6 24 63 65.  I have been an arbitrator since 1996. 

We are the only industry where an employee can be sued for negiligence acts.   We do not own our own book of business and havent since October 2000.   Because FINRA has a statute of limitations of 5 to 6 years you must continue to pay for an E & O policy for that period of time after you attempt to get out of the business. \  
Mar 2, 2009 6:23 pm

there are 800,000 registered representatives in this country.

I would say that about 80% think they are independent contractors when if fact they Employees without employee benefits.    
Mar 2, 2009 6:47 pm

Why not cut to the chase? What is your agenda and what are you selling?

Mar 2, 2009 7:19 pm

[quote=YHWY] Why not cut to the chase? What is your agenda and what are you selling?


Looks like E&O to me.

Mar 2, 2009 8:00 pm


I AM TRYING  TO GET EVERY REGISTERED REP TO REALIZE THAT THEY HAVE BEEN SCREWED MY THE VERY ORGANIZATION THAT APPROVED MADOFF.   I am trying to get Regitered Reps to call thier congressman to do something about it.   You do not I repeat you do not own your book of business. You are an employee.   We should be given the same respect that all employees enjoy in this country.  instead we have to be afraid and cow down to FINRA and our broker dealer as if we are employees but without the same privileges.    When you finally get to the age when you think you can retire.  You will understand what I am saying.   I was an arbitrator for 12 years.  I saw what happens to registered reps.  I know what can happen.   THis needs to change.     IF you dont think so then ask yourself why do you have to ask for permissiont advertise.  Why do you have to tell FINRA that your work at some other place.  Why do you  have to tell FINRA that you are on the board of a non profit.  etc etc.    What other organization in this country is forced to disclose those kind of facts.
Mar 2, 2009 8:19 pm

Slowly, we fight to the point of this thread…
 So far, what’s clear is that you have a serious grudge against FINRA. Other than that, it sounds like you are a retiree-age or retired broker who now finds himself on the losing end of a pricey FINRA ruling from some infraction you committed years ago.
 So…hot…warm…cold? Give us a clue.

Mar 2, 2009 8:25 pm

Stuff like this used to keep me up at night.  What if a trade that felt like the right thing to do at the time was actually not a good fit, but still an honest mistake.  What if this trade lost a client thousands of dollars and I was on the hook for the mistake?

then I got over it.

Do what's right for the client always, and you'll be just fine.

Mar 2, 2009 8:34 pm

Do I have a grudge against FINRA.  Ok lets see.  As an arbitrator for 12 years we busted registered reps for doing what they thought was right.  Some actually deserved it.  Maybe.  Until one day I was an expert witness for a public arbitration.  NOT Finra.  An RIA had invested an old mans money that went south during the 2000 debacle.  Bad choices of of stocks for an investment portfolio for a man who was 70 years old at the time. 

  The RIA was not registered with the NASD at the time nor had he been for a few years but was managing a fund of tech stocks.    He was not liable for the problem under the Public Or Civil laws.  I repeat NOT liabale due to the prudent person rule.  Although if he had brought this to the NASD under the Know the customer and what is good for the customer and risk tolerance, etc.  He would have been liable.  Because the RIA was no longer a member it was a civil matter.   And the RIA got off.   Next You work all your life building a book of business.   Only to find out that it doesnt belong to you.  YOU DO NOT EVER OWN YOUR BOOK OF BUSINESS.   This is a FINRA rule.
Mar 2, 2009 8:42 pm

NO I have no complaints against me.  I just realized that we are the only industry in the united states that can be sued for accidents, negligence, or doing what we think is right and it turns out that maybe the customer later determines that it wasnt.  Or  the customers heirs determines that it wasnt.   It doesnt always have to be the customer who brings an action.  Remember the statute of limitations on FINRA issues is 5 to 7 years after the occurance.  There in lies the problem. 

And grudge oh yes....  Work for 15 years and then find out with the flip of a  pen,  an amendment to the rules without even a vote from the peers ( registered representatives)  you had all your base taken from you.  Dont you get it.  This is not a government agency making the rules.  This is an agency that is an association of broker dealers that YOU WORK FOR.  I REPEAT YOU ARE AN EMPLOYEE.    Yet you signed a contract that stated you wanted to be an independent contractor.  Do you  really think you are independent to make decisions on the way you run your business of for that matter your life outside of your securities business?

Mar 2, 2009 8:47 pm

You can be sued by the estate, the heirs for the estate, the customer, the attorney for the customer, the professional conservative, anyone who feels THAT THE INVESTMENT MAY NOT HAVE BEEN RIGHT FOR THE CUSTOMER.

  when was the last time a real estate agent was sued for a house loosing 40 to 50% of its value?   When was the last time an auto worker on the assembly line or in a repair shop was sued for the improper installation of a part that caused an accident?  Do you know if any i repeat any EMPLOYEES  were sued for any Airline Mishap due to a faulty part?   Never  Never Never. 
Mar 2, 2009 8:50 pm

OH must i remind you they are not clients.  They are customers.

when you have time, ask your CPA who they have to list thier license with?

ANd then ask them if they have to notify the AICPA board about any outside business activities.

Mar 2, 2009 8:54 pm

I don’t want to be an employee that is why I went indy… I like the tax benefits, I don’t care about the other benefits(wife is state employee, my medical is fine)…

  Why would I want to be an employee? That is what Jones is a giant indy without the products and with crappy benefits... and control...
Mar 2, 2009 9:18 pm

All good arguments.  The next time you see a policeman ask him how much he has to pay for his E & O insurance. 

Then ask  him if he has to buy the E & O insurance to keep his job.   Hmmm I think you know the answer to that one.   As for teachers again ask them How much they pay for their E &n O insurance and Ask If they have to buy it from the school they work for?  ANd if they dont do they get to keep their job.    Oh and ask them if they have to ask for approval to get a second job.    I think a policeman does.  Only if and I repeat only if it is security related.    If they wanted to mow lawns for some extra bucks or work as a sub contractor they wouldnt have to disclose that.   Its called Outside business activities.    Then if you dont believe what I am saying ask the SEC if ALL YOUR OUTSIDE BUSINESS ACTIVITIES ARE indirectly or directly related to your Securities license.   
Mar 2, 2009 9:21 pm

I dont know about you but I get a 1099.  If you get a W 2 then you are an employee.  NUff said. 

  I am talking about the hundreds of thousands of reps who are independent contractors.  And the Insurance industry is getting ready to get hit as well.  If FINRA has their way Index Annuities will require a series 6.  That would make the entire book of business of Index Annuities of an Index Annuity sales person the property of the Broker Dealer that now holds their Series 6
Mar 2, 2009 9:26 pm

I couldnt agree more.  I am saying either make us an employee or get out of our face.

  Let me run my business.  Dont force me to run my personal emails through the BD.  Dont force me to disclose all my outs ide business activities.  Dont Force me to adhere to the BDs kind of advertising.  Now if the BD thinks that FINRA might object to a particular type of advertising they wont allow you to advertise.   The list of what you cant do is growing.  But the most important t hing here is ownership of your book.  That is the most important factor.  The right to m ove it on a whim.    Just like it was before 2000.  I want to know that if I am not h appy with the way my BD is treating me that I can move my business to a new BD.  I want to know that if my broker is a crook and is taking advantage of my clients I can  move overnight.  I want to know that if a new BD offers me a better deal I can move my Book overnight.  I am in control of my book.  THAT IS NOT THE CASE NOW.    YOU do not own your client base and never will.   IN 2000 FINRA took care of that.
Mar 2, 2009 9:57 pm

jcordova, ok, there are certain things that aren’t quite right.  What’s your point?

Mar 2, 2009 10:14 pm


  He'll then tell me that his pay scale is maximized at $65,000 a year.  I'd much rather spend $1,200 for E&O and make a few hundred thousand, than get "free" E&O, 60 mandated hours a week, people potentially shooting at me, and $65K a year.   [/quote]   I think that's the way most new Jones FAs describe doorknocking and being a new FA these days.   At least we get free business cards.
Mar 2, 2009 11:06 pm

All I am saying is and have said for several years is give us our freedom or make us an employee.

  LEt me own my book of business in this free m arket society.  It is a free market correct? Then I should be able to look at another broker dealer and say What will you give me to move to you?  Just like it used to be before 2000.  And then when I want to I can sell it because it has value.  I dont have to get my clients permission to sell it.   Its my book of business.  Just like an insurance agents.  Or just like a CPA or just like a doctor or attorney.    We treat ourselves like used car salesmen.  On the other hand if you have a book that is entirely advisory you have value.  But you still have to get the clients permission to move. and if you study the situation you can eventually determine that it is difficult to just get out of this business now.   So give us the freedom to move.  And give the regulatory side of the business to  the Civil courts.  Thats it.. Nothing else.   IF FINRA  got out of the punitive side of the business and gave it to the Civil courts under civil law our E & O premiums would adjust down because the same rules would apply as to civil law.  The prudent man rule.