The SEC and FINRA have reached a settlement with Goldman Sachs regarding the bank’s failure to supervise its employees participation in the firm’s “trading huddles.” As a result, Goldman will pay $11 million in fines to both the SEC and FINRA. Goldman consented to the fines without admitting or denying the findings. Read more here.
Does the CFP Board’s recent creation of the position and appointment of a new director of investigations create yet another level of securities enforcement scrutiny for financial planners? On the surface, it sure looks like it.
A recent Advisor One article entitled “CFP Board’s Keller Says New ‘Top Cop” Will Beef Up Investigations” quotes CFP Board CEO Kevin Keller stating that the reason for the position was not because of an increase in the number of compliance cases or violations of CFP rules but to “to build our capacity to achieve our mission of benefiting the public.”
Translation. What this means is that given its membership growth expect number of enforcement cases to rise. More recently, the Board’s enforcement efforts have focused on bringing cases against members who have had bankruptcies or who have disclosures in FINRA or SEC matters that involve claims of misrepresentation or fraud. Also, the number of cases the CFP Board opened in 2011 (1,569 cases) increased from the 1,472 cases opened in 2010. Although most CFP investigations do not result in enforcement actions, expect a continued increase in the number of investigations with the new appointment.