Important Announcement
We are pleased to share that as of August 1, 2025, Braeden Anderson, the founder of Anderson P.C., has joined Gesmer Updegrove LLP as a Partner. Work currently performed by Anderson P.C. will be transitioning to Gesmer. This website will remain active as a curated archive for legal insights.
Gesmer Updegrove LLP, founded in 1986, is a nationally recognized law firm with a premier reputation for representing high-growth companies, innovative technology pioneers, and venture-backed startups. Together, we are enhancing our ability to provide comprehensive, end-to-end legal support to entrepreneurs, founders, investors, and scaling businesses across every stage of the corporate lifecycle. From formation, fundraising, and IP strategy to tax planning, M&A, securities compliance, enforcement defense, and strategic exits, our combined strengths now span the full spectrum of business law.
Thank you for following and supporting us on this journey. To learn more or to connect with Braeden or a member of the Gesmer team, please visit: www.gesmer.com or e-mail him at braeden.anderson@gesmer.com
D.C. Circuit Issues Long-Awaited Decision in Alpine v. FINRA
On November 22, 2024, the D.C. Circuit issued a landmark decision in Alpine Securities Corporation v. FINRA, a case that examines the constitutional boundaries of the Financial Industry Regulatory Authority’s (FINRA) enforcement powers. The ruling enjoined FINRA from expelling Alpine Securities Corporation without prior SEC review, emphasizing the limitations of expedited enforcement proceedings under the nondelegation doctrine.
Elizabeth Warren Questions FINRA's Enforcement Decline: Key Considerations for Companies
On August 29, 2024, Senator Elizabeth Warren raised concerns regarding a sharp decline in enforcement actions by the Financial Industry Regulatory Authority (FINRA). In a letter to FINRA CEO Robert Cook, Warren questioned whether this drop reflects a deliberate shift in regulatory strategy. The number of enforcement actions last year was the lowest since FINRA’s inception in 2007, and fines have similarly decreased. Warren’s inquiry highlights potential implications for both FINRA’s oversight and the broader regulatory landscape.
Broker-Dealer Fined $3M for Trading Supervision Failures
In a recent settlement with FINRA, a major broker-dealer agreed to pay over $3 million in monetary sanctions due to supervisory failures related to short-term trading recommendations. These trading activities, which spanned a two-year period from January 2017 to December 2018, resulted in client losses while generating significant profits for the firm.
Massachusetts Investment Advisor Fined for Undisclosed WeChat Communications
In a recent enforcement action, a Massachusetts-based investment advisor has been sanctioned by the Financial Industry Regulatory Authority (FINRA) for conducting business communications through an unapproved messaging platform, in violation of recordkeeping rules. The advisor, formerly associated with a major brokerage firm, was found to have used WeChat, a Chinese social media application, to interact with clients without the firm's approval or proper documentation.
FINRA Update on Crypto Asset Activities
On August 14, 2024, the Financial Industry Regulatory Authority (FINRA) issued an important update regarding its ongoing efforts to engage with its members on the subject of crypto asset activities. Referred to as "crypto assets," these are defined by FINRA as assets issued or transferred using distributed ledger or blockchain technology. These assets include virtual currencies, coins, and tokens, which may or may not meet the definition of "securities" under federal securities laws.
Former Broker Fined for Alleged Stock Hype in Client Emails: A Cautionary Tale for Advisors
On August 28, 2024, the Financial Industry Regulatory Authority (FINRA) announced the suspension and fining of Richard Joseph Jackson, a former broker, for allegedly engaging in misleading communications with clients regarding stock performance. This case underscores the critical importance of compliance with FINRA’s communication rules, particularly for financial professionals responsible for advising clients.
Top 10 Securities Enforcement Developments of Summer 2024
In this review, we highlight the top 10 securities enforcement developments of summer 2024, offering insights into the latest trends, landmark cases, and strategic shifts that are likely to influence compliance strategies and corporate governance moving forward. Whether you're navigating these issues in-house or advising clients, understanding these developments is essential for staying aligned with the evolving standards of securities law.
FINRA’s Landmark Action on Social Media Influencer Programs
In a significant development, FINRA has imposed an $850,000 fine on a financial services firm for violations related to its use of social media influencers. This marks the first enforcement action by FINRA concerning a firm's supervision of social media influencer activities.