Mr. President, Let’s Watch Where Financial Regulatory Rubber Meets the Road
By Larry Doyle on September 16, 2009 at 3:01 PM in Bernie Madoff, Economy, FINRA, SEC, Sense on Cents (Larry Doyle blog), Wall Street
On the heels of President Obama’s speech on Wall Street at which he called for meaningful financial regulatory reform, I welcome submitting to him and the American public the following video clips. These clips are from Fox Business News “America’s Nightly Scoreboard” with David Asman on September 3rd.
While President Obama and Congress may believe financial regulatory reform needs to focus on the SEC, the Federal Reserve and assorted other governmental agencies, I would remind the President and his Congressional colleagues that Wall Street is regulated not only by the SEC but to a great extent by the self-regulatory organization known as FINRA (Financial Industry Regulatory Authority).
This discussion on “America’s Nightly Scoreboard” is separated into two parts.
Highlights from the videos include:
1. Richard Greenfield, an attorney representing Amerivet Securities, makes the claim that FINRA under the leadership of Mary Schapiro failed to protect investors.
2. former SEC chair Harvey Pitt defends Shapiro and FINRA
3. Greenfield indicates that a FINRA insider claims FINRA invested in Madoff!!
4. I join the panel and provide details as to why FINRA, via its parent the NASD, did have responsibility to oversee Madoff. I also comment on the nature of the relationship between Wall Street and Washington, FINRA’s investment and timely liquidation of its Auction-Rate Securities position, and the need for total transparency at FINRA.
4. the head of the Madoff Victims Coalition for Investor Protection, Ronnie Sue Ambrosino, weighs in that the entire regulatory structure from the SEC to FINRA to SIPC (Securities Investor Protection Corporation) have failed to protect investors.
In my humble opinion, the conclusion of this show highlights the screaming need for FINRA to open its books and records for a full and thorough independent analysis and review. In so doing, hopefully investors specifically and the American public at large can regain a degree of confidence in the badly shattered Wall Street regulatory process.
If you care about the markets and our country, I beseech you to watch this 18 minute video in its entirety.
Thoughts, comments, questions always welcome and appreciated.
LD
PART I
PART II
(Release: November 13)
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Good segment, Larry. Seems like there’s a whole lot of books needing the light of day. I agree with the woman in part 2, one of Madoff’s victims: there is a sad and consistent pattern in all these scandals–those incestuous ties between the regulators and very institutions they’re suppose to be watching. In fact, I’m beginning to wonder if there are any honest people left. It’s depressing. And people wounded the most are like the couple featured at the end–everything down the drain, while Shapiro gets a nice fat bonus. Frankly, I found Harvey Pitts’ argument pretty lame, even infuriating because no one wants to take responsibility, just kick the can down the road.
But you were clear and on the money. Bravo!
Larry,
Thanks for the videos. It’s interesting stuff for this Wall Street outsider.
I’ve never had enough to do any type of investing, except in my public employers retirement association my Social Security from my other jobs, and my kids’ college funds. The videos make clear to me that I’ve been lucky in some regard for my relative lack of wealth. I’ve always said my wealth was in my kids, family, and friends (especially the furry ones).
Still I worry for my sons. I had a long talk with my older son–who’s worried about his ability to support his little 5-month-old son as he’s in the middle of a move to a different state for his job. Will the house sell? Will the more expensive state he’s moving to have a place he can afford (i.e., Will he be back to renting)? Will his wife have to work part-time evenings while he babysits the baby (or will he have to get the part-time job) to make ends meet? How much of his savings will this move eat up?
My generation had it much easier as we moved into adulthood. I didn’t get rich, but that was never my goal. It was just easier to get started in life.
Every time I read your articles, I realize what a different universe Wall Street is from mine. But it’s also frightening because I fear so much the Wall Street mess will mess up my children’s futures because of all the “fixes” this Congress is attempting.
How did we get away from necessary regulation of Wall Street and from the expectation that the different regulatory agencies would have clear business guidelines and clear boundaries in regard to their work?
Go LD!!
Great post. So cool to see you on video! Hope you are successful in getting FINRA’s books open.
Wait we had to click “read more” to find out LD is in the segment???
Nice work LD.