If you are licensed by FINRA, there is no doubt that you are familiar with the broad investigation powers that FINRA possesses if there is a suspicion of wrongdoing. However, if you are licensed by FINRA and working in Florida, you are very likely to also be licensed by a Florida agency. How does this interplay between FINRA and Florida work in professional license disciplinary proceedings?
FINRA Rule 8210 and the requirement to give testimony under oath.
Under FINRA Rule 8210(a)(1), during an “investigation, complaint, examination, or proceeding” the FINRA staff shall have the right to “require a member, person associated with a member, or any other person subject to FINRA’s jurisdiction to provide information orally, in writing, or electronically (if the requested information is, or is required to be, maintained in electronic form) and to testify at a location specified by FINRA staff, under oath or affirmation administered by a court reporter or a notary public if requested, with respect to any matter involved in the investigation, complaint, examination, or proceeding”
FINRA Rule 8210(c) states, “No member or person shall fail to provide information or testimony or to permit an inspection and copying of books, records, or accounts pursuant to this Rule.”
Under the FINRA Sanctions Guidelines for March 2019, the recommended sanction for failure to make the required disclosures under FINRA Rule 8210 is a fine of $25,000 to $77,000 and the recommendation of a bar of the FINRA member’s license, if the member fails to comply at all. If the member partially complies with the request, the Sanction Guidelines also recommends a bar of the FINRA member’s license, except if the member can demonstrate that he or she substantially complied with the request.
The interplay between FINRA Rule 8210 and the right to remain silent in Florida professional license disciplinary proceedings.
There is a right to remain silent for the licensee in Florida professional license disciplinary proceedings. If you are a licensee that is the subject of a disciplinary proceeding relating to your professional license, the right to remain silent provides the licensee with some protection from testifying against themselves. However, if this licensee is also licensed by FINRA, the requirements of FINRA Rule 8210 can conflict with this right.
If a person is under investigation for FINRA and for Florida, or may face investigation in the future for a Florida professional license, it is extremely important that the licensee obtain legal counsel to represent them in both actions. Due to the requirements and severe sanctions for violations of FINRA Rule 8210, the licensee needs to tread carefully with the assistance of counsel in order to put him or her in the best position to be successful in defeating the claim of a violation. This conflict between the rules makes defense of a FINRA violation for a Florida professional licensee very complex.
Contact us today if you are the subject of a Florida professional license disciplinary proceeding or investigation.
If you think you may be the subject of a FINRA investigation or if you are the subject of a Florida professional license disciplinary proceeding, contact us today to schedule a free consultation. During the consultation, one of our attorneys will review the allegations against you and will review the professional license disciplinary process with you. We will also advise you of your rights in the proceeding. It is highly recommended that you obtain representation by an attorney in any Florida professional license disciplinary proceeding.