Securities Regulatory Defense

Click here if you received a Finra Inquiry Letter.

Securities regulatory defense is also a focus at Bartell Law. The firm represents registered broker-dealers, investment adviser firms, stockbrokers, individual investment advisers, compliance officers, managers, executives and other financial professionals in regulatory investigations, inquiries, industry sweeps and administrative actions by financial regulators, including the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), state securities regulators, state attorneys general and other financial regulators.

The firm has experience with a variety of different regulatory matters, including, for example:

• unauthorized trading;
• selling away;
• failure to supervise unsuitable transactions;
• unauthorized outside business activities;
• discretionary trading without written authorization;
• deceptive conduct in an internal investigation;
• receipt of undisclosed gifts from clients;
• books and records falsification and notarization violations;
• complex retail structured products issued by broker-dealers; 
• the sale and structuring of collateralized debt obligations; 
• state false claims act violations; 
• the sale and marketing of auction rate securities and the operation of the auction markets; 
• the 50-state settlement of auction rate investigations sponsored by the North American Securities Administrators Association; 
• broker departures, client information privacy and Regulation S-P;
• broker-dealer sales incentives and contests; 
• unfair customer account fee structures; 
• brokerage cold-calling practices; 
• state and federal do-not-call violations; 
• investor privacy policies and procedures.

The firm handles all aspects of regulatory defense, including negotiating with regulators, preparing document and data productions, responding to requests for information, drafting legal briefs, preparing witnesses to testify, attending on-the record interviews, conducting hearings, and negotiating consent orders.

• • Informal Internal Investigations.  To understand the factual background necessary to assess potential exposue and devise a strategy, the firm will conduct an informal internal investigation into the relevant areas. The firm interviews witnesses as necessary, including registered representatives, advisers, compliance officers, branch and regional managers, administrative managers, executives, sales assistants, traders, research analysts, attorneys and other employees. The firm also reviews relevant books and records, including email, marketing materials, trading records, account statements, prospectuses and other offering materials, compliance policies and procedures, phone records, journal notes, databases and social media. 

• • Responding to Finra Inquiry Letters. The firm is experienced responding to Finra Inquiry letters. These Finra letters mark the beginning of a preliminary inquiry (and usually have a "Star #" in the regarding field). Finra uses inquiry letters to collect information from financial advisors and broker-dealers in a variety of circumstances. Common examples include letters seeking information about: (1) the reason for termination (provided on Finra Form U5); (2) customer complaints, arbitration claims, and civil litigation; (3) criminal matters; (4) disclosure problems on Finra Form U4; and (5) state, federal, and foreign regulatory actions. The inquiry letter will typically make requests for documents and information under Finra Rule 8210. Often Finra seeks a "signed statement addressed to Finra in response to the allegations." The inquiry letter can later evolve into a full investigation, particularly if the inquiry is handled improperly, and ultimately the advisor may face a disciplinary action by Finra. Click here for more information on Finra inquiries and investigations. 

• On-the-Record Interviews.  The firm prepares witnesses to testify both at on-the-record regulatory interviews and at administrative hearings. The process can increase professionalism and accuracy, and can help reduce any unnecessary stress and disruption that an investigation can create. The firm will also attend the interviews with clients to provide support and render objections where appropriate.   

• Document, Data and Information Productions.  The firm has experience with handling large-scale document, data and information productions to regulators. This includes negotiating the scope and specifics of requests for documents and information. The firm participates in answering written requests for information by assisting the client in obtaining the requested information through interviews, records reviews, and electronic databases, and by preparing accurate draft responses. The firm also prepares paper and electronic documents for production, including reviewing for responsiveness and providing written explanations of the production to regulators. The firm is experienced at objecting to requests, where appropriate, and developing facts and legal arguments to support our objections.   

• • Legal Briefing, Motions, Wells Submissions. The firm analyzes the relevant facts, researches and analyzes the law, and provides thoughtful and persuasive briefing for administrative motions and oppositions and Wells Submissions.

• • Administrative Hearings. The firm handles all aspects of administrative hearings including: developing a trial strategy; answering administrative complaints; preparing witnesses; interviewing, selecting and preparing experts; conducting the hearing; and arguing appeals.

• • Settlements, Consent Orders. The firm has substantial experience negotiating the settlement of regulatory matters before hearing, including the negotiation of consent orders involving fines, penalties, injunctions and specific undertaking requirements.  

If you or your company have a regulatory matter, consider Bartell Law for effective and economical regulatory defense. Give us a call. We'd be happy to discuss how we can help.