FINRA And Its Relentless Attack on Excessive Fees

By |2017-10-08T21:22:25+00:00January 26th, 2015|Investing|

Let’s see…..hmm. The Commissioner of Baseball is also one of the franchise owners…….

The NFL is a nonprofit organization that pays its commissioner $44 million a year…….hmm

The securities (brokerage) industry to slow federal oversight, declared itself a self-regulating industry.
Hmmmmm…..the brokerage industry earns compensation for actions, sales, management, etc.
So….NASD (National Association of Security Dealers was renamed FINRA (Financial Industry Regulatory Authority) to appear to be more regulatory.

The SEC (Security and Exchange Commission) has complained for years to FINRA that oversight was too narrow.
FINRA announced it would slow down (corral) excessive fees.

Hmmmmm…where does FINRA get its financial budget? A: The brokerage industry.
How much is their annual budget (2013)? A: $900 million
How much did FINRA overspend (lose) in 2013? A: $73,400,000 (loss)
How many people does FINRA employ? A: 3,400 (2013) 500 new employees planned for hire in 2014.

So….a self-regulating industry, with a budget of $900 million, overspent regulating an industry (by $73 million) that FINRA has decided is charging too much in fees…..hmm.

Let’s summarize:
FINRA regulates the brokerage business.
FINRA is supported by the brokerage industry.
The brokerage industry earns it income from fees.
FINRA wants to reduce the fees the brokerage industry charges.

Am I nuts or do I see a problem?

A recent article in Investment News reported the planned crackdown on excessive fees charged by the brokerage industry.

Here is the link:



About the Author:

Bill Broich
Bill Broich is a well-known annuity expert with over 30 years of experience. He has written hundreds of articles on annuities and other financial topics, and has been a featured commentator on TV, Radio and the Internet. To follow Bill's profile, click here.