Labor & Employment Law

FINRA Cracks Down On Phony Authorship

By Dobin & Jenks

We've all seen them - the books and magazines that look like they feature a financial salesperson. In fact, NBC's Dateline program did an expose on annity sales practices. Several of the agents the show targeted had phony ghostwritten articles.

In FINRA Notice to Members 08-27, the regulators stated that using ghostwritten materials could violate a number of rules, including NASD Rules 2110, 2120 and 2210 and Incorporated NYSE Rule 472. Frankly, the use of the word "could" is fairly silly. How about "does" unless, in a conspicuous place, the financial representative discloses that the only connection he had to the article was possession of a credit card and a digital picture?

This is one of those common sense kind of moments. Others call it the "Wall Street Journal" test. Do you want your behavior displayed on the front page of the "Wall Street Journal"? Generally, no.

FINRA's Notice to Members addresses a recent theme, aggressive sales tactics used in connection with seniors. FINRA has issued pronouncements regarding "free" lunch seminars, the use of certifications that are nothing more than mail order multiple question tests and, now, the use of phony news articles. All of these are good steps to protect those who can least afford to make financial mistakes.

That's the view from The Law Planet - Jupiter, Florida.

Full post as published by The Law Planet Blog on June 02, 2008 (boomark / email).