FINRA is increasing the pace of investigations and enforcement actions against advisors who defraud older investors, according to the Wall Street Journal. FINRA’s goal is to protect seniors against unscrupulous financial advisors who take their money, leaving them unable to support themselves financially.
According to Susan Merrill, FINRA’s enforcement chief, FINRA investigation teams will have four months to complete their work. If they find wrongdoing and refer a case to FINRA’s enforcement division, the case will cut to the head of the queue.
In the past, cases used to take several months to several years to get resolved. But that is likely to change as FINRA accelerates its efforts to identify and punish advisors who victimize senior investors.
Fueling FINRA’s fast-track approach are concerns about three trends:
- The inability of older investors to fully supervise their advisors due to advanced age or medical problems.
- The shift away from employer-sponsored retirement plans and toward self-funded plans.
- The use of “free lunch” seminars and senior-oriented designations to mislead investors about an advisor’s products and capabilities.
What “red flags” are affecting your business? Send your comments to the National Ethics Bureau at email@example.com.