A $150 million book of business Wells Fargo promised him never materialized — and then the wirehouse took him to arbitration…..

A wirehouse promises a veteran advisor a $150 million book of business and a $450,000-plus upfront bonus to come on over. The wirehouse resigns the FA’s job for him at his current firm, then e-mails his clients to tell them he’s leaving.

This strange and unusual real-life scenario begins to boarder on the bizarre when the book of business turns out to be only $10 million and five months after the advisor joins the firm, the wirehouse takes the vexed FA to arbitration by the Financial Industry Regulatory Authority (FINRA).

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UBS Securities is getting smacked down – again – for short sale shenanigans. OnWallStreet.com reports that the Securities and Exchange Commission fined the company $12 million on this issue. This comes on the heels of an $8 million fine from the Financial Industry Regulatory Authority.

The complaints that the SEC and FINRA had about UBS involved the company’s short sales recordkeeping. OnWallStreet.com reports that the SEC had issues with “inaccurate recordkeeping practices in providing and recording so-called ‘locates’ to customers seeking to execute short sales.” Now the problem, a reported violation of SEC Regulation SHO, reportedly has been fixed, according to OnWallStreet.com.

George Canellos, head of the SEC’s New York office, said that UBS “permitted its  employees to create records that do not accurately convey the basis upon which its employees granted locates.” And the SEC’s order against UBS said that “UBS’ practices obscured inquiry into whether UBS had a reasonable basis for granting locates, and created a risk of located being granted based on sources that could not be relied upon if shares were needed for settlement.”

OnWallStreet.com reports that “over the past two years FINRA has fined Deutsche Bank $575,000; Milwaukee-based Robert W. Baird & Co. $900,000 and Boston-based National Financial Services $350,000 for violations of Regulation SHO. None admitted any wrongdoing.” 

Written By Lisa Swan

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