Mike Rufino, the head of the Financial Industry Regulatory Authority (FINRA)
member regulation, recently outlined how the organization defines a high-risk
broker during its annual conference in Washington.
Rufino said that while there is no strict definition, FINRA uses specific
criteria to identify these financial representatives, including:
- Geographical location
- Exam attempts
- Employment and termination history
“Then we use that quantitative assessment that we qualitatively assess
and look at the number of complaints a broker has, the nature of those
complaints,” Rufino said.
FINRA also looks at the number of disclosures the broker has, and when
they occurred. Rufino said that when a broker has a high number of recent
disclosures, it could elevate the level of risk associated with them.
FINRA will also look at whether or not they are currently appealing sanctions.
“If FINRA has barred the individual and you have an appeal [to FINRA’s
National Adjudicatory Council] we deem those individuals to be of the
highest risk, and they will automatically be deemed a high-risk broker
by FINRA,” he said. “We will monitor and examine those individuals
very closely while they wait for their appeal.”
At Meyer Wilson, we are committed to working with people who lost money
because of their financial advisor’s reckless or negligent actions.
Contact us today to discuss your case and learn more about the next steps you can take.