White Papers

The Efficacy of Securities Arbitration And Proposals for Change

In January 2010, FSI and Briggs and Morgan, a 2010 FSI Law Firm Sponsor, conducted a survey of FSI members on securities arbitration. The survey results were to serve as the basis for a White Paper describing our members’ opinions about and experience with the FINRA arbitration process. “The Efficacy of Securities Arbitration and Proposals for Change”, was released in April 2010.

• Full Version (61 pages)

FSI member firm responses revealed the following trends:

• FINRA arbitrations are more cost-effective than litigation in terms of total cost and cost to conduct pre-hearing discovery.
• FINRA arbitrations are generally resolved more quickly than litigation.
• The perceived benefits of FINRA arbitration diminish when the number of claimants or respondents increases, or when a large demand for monetary relief is made.
• Arbitrators should provide written decisions that include factual findings and legal conclusions in support of their awards to ensure transparency and consistency of results.

Independent Broker-Dealers: Building a Culture of Compliance

To address concerns raised by regulators about the supervisory and compliance capabilities of independent broker-dealers, FSI released in March 2007 our second White Paper, Independent Broker-Dealers: Building a Culture of Compliance. This paper provides an overview of the current regulatory climate and a response to specific regulatory concerns.

• Executive Summary (4 pages)
• Full Version (32 pages)

Making the Case for Independent Broker-Dealers & Financial Advisors

In 2005, FSI commissioned research of its independent broker-dealer members in order to collect and analyze data on its members' business practices, gauge members' perceptions on the current regulatory environment, and evaluate the impact of a rapidly changing regulatory climate on their businesses and the businesses of independent financial advisors that are affiliated with them. The results of this research, along with supporting information and extensive interviews with executives of independent broker-dealer firms, were published in January 2006 in Making the Case for Independent Broker-Dealers and Financial Advisors.

• Executive Summary (4 pages)
• Full Version (28 pages)
• Exhibits (10 pages)

FSI on the Issues

• Regulators' Institutional Bias Toward Cost as the Primary Basis for Determining Investment Suitability (12 pages)*
• Rulemaking by Enforcement (12 pages)
• Facts, Fads and Fiction: Do You Really Want to be a Solo RIA? by John Simmers (2 pages)
• To RIA or Not to RIA? by Eric Schwartz (3 pages)

*Note: NASD Advertising Regulation has reviewed this paper and concluded that it does not constitute an advertisement or sales literature. Click here to download the NASD Review Letter.