As financial companies know, compliance lawsuits can be expensive, which is why it is vital to have a competent compliance staff. We have witnessed in the U.S. — since the 2008 financial crisis — the growing importance of having a chief compliance officer, particularly with legislation requiring companies of certain sizes and business practices to keep one on staff. In fact, the Securities and Exchange Commission has made a point of cracking down on financial firms’ compliance missteps. Yet, examples persist demonstrating the dangers of having sub-par compliance procedures in place. On February 24, the Financial Industry Regulatory Authority (FINRA) fined financial and investment firm Berthel Fisher $775,000 for compliance failure.
Brad Bennett, FINRA’s executive vice president of enforcement, stated that Berthel Fisher had failed to adequately train and supervise brokers selling investments including non-traded real estate trusts and leveraged and inverse exchange-traded funds.