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Audits & Regulatory Investigations

Our New York audits and investigations attorneys offer strategic legal defense to individuals and entities who are being investigated, subpoenaed and/or charged by FINRA, the SEC, the U.S. Attorney’s office, state securities regulators, and other exchanges.

Being the subject of a regulatory investigation can be a life-altering experience. The magnitude of potential penalties may include substantial fines, losing your license, or even criminal charges. It can even influence your future employment in the securities industry as well as other industries too. Having experienced New York audits and investigations attorneys representing you and protecting your rights may be the key to an outcome in your favor.

It is important to be properly prepared for responses to inquiries and subpoenas. Early intervention by an attorney can avoid unnecessary issues and prolonged proceedings.

Malecki Law represents clients at each stage of the regulatory and self-regulatory process — from an informal inquiry, through contested hearings (including on-the-record testimony and the “Wells” process), as well as on appeal. We assist clients through:

  • Obtaining "No-Action Letters" i.e., a complete defense with no reporting on your license
  • Negotiation of favorable regulatory settlements to minimize sanctions, generally known as AWCs (Acceptance, Waiver and Consent)
  • Fully litigated hearings before regulators, self-regulatory organizations, government agencies, and criminal proceedings
  • Formally responding to Regulatory Inquiries, Investigations, Exams & Audits, including On-the-Record Interviews, Document and Information Requests, and Subpoenas
  • Review and Creation of Compliance / Supervision Directives and Procedure
  • Membership & Registration Continuation Proceedings

Malecki Law’s audits and investigations lawyers in New York have represented brokers, investment advisors, supervisors, compliance professionals, structured finance professionals, analysts, CFOs, CEOs, COOs, and others who fall under the watch of the Financial Industry Regulatory Authority (FINRA), the United States Securities and Exchange Commission (SEC), the U.S. Attorney’s office, state securities regulators, and other exchanges.

For over 20 years, our audits and investigations law firm in New York headed by lawyer Jenice Malecki and her team at Malecki Law has assisted various types of industry professionals and firms in formal and informal civil, criminal, regulatory and enforcement actions, investigations, audits, and proceedings initiated by the SEC, FINRA, NASD, NYSE, AMEX, federal prosecutors, state attorneys general, and other regulatory and self-regulatory agencies.

FINRA Investigations

One of FINRA’s top priorities is to advance investor confidence in the securities markets through vigorous enforcement of federal securities laws. FINRA has the authority to fine, suspend or bar brokers and firms from the industry. FINRA may initiate investigations from many varied sources, including examination findings, filings made with FINRA, customer complaints, anonymous tips, automated surveillance reports, and referrals from other regulators or other FINRA departments, among others.

As of 2019, FINRA has almost 625,000 registered members and 3500 registered securities firms, all of whom it is responsible for regulating and overseeing for compliance. In doing so, in 2019, FINRA gave out over $39.5 million in fines and $27.9 million in restitution. The agency also barred almost 350 individuals and expelled 6 firms and suspended over 400 other individuals and over 20 firms. In addition, FINRA referred more than 800 fraud and insider trading cases to the SEC and other agencies for litigation and/or prosecution.

In 2016, the Department of Labor introduced new tougher regulations holding brokers and insurance agents to strict “fiduciary” standards. And just last year the SEC adopted Regulation Best Interest under the Securities Exchange Act of 1934. Regulation BI, which is slated to take the place of Suitability, will establish a standard of conduct for all brokers, broker-dealers, and associates regarding recommendations they make to customers. As the regulations of the securities industry become more demanding, so has the scrutiny of securities professionals and the need for regulatory defense and other proceedings.

SEC Investigations

According to the SEC’s 2019 annual report in which it outlines its efforts on behalf of investors, the SEC brought a record 862 cases, which were composed of 526 independent actions and 336 actions against issuers that were delinquent in making required filings or “follow on” administrative proceedings (as reported by the SEC). These SEC actions resulted in a record total of monetary sanctions being imposed against defendants and respondents. In the fiscal year of 2019, the SEC obtained orders requiring the payment of $4.349 billion in penalties and disgorgement, which is a record for the Commission.

Common violations that may lead to investigations include:

  • FINRA or SEC rule violations
  • Misrepresentation or omission of important information about securities
  • Manipulating the market prices of securities
  • Stealing customers' funds or securities
  • Violating broker-dealers' responsibility to treat customers fairly
  • Insider trading (violating a trust relationship by trading on material, non-public information about a security)
  • Selling unregistered securities

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Testimonials From Former Clients
I highly recommend Jenice and her team at Malecki Law. I had a challenging, and lengthly case. Jenice was professional, very knowledgeable, and a pleasure to work with. She managed to make the process far less stressful during a very difficult time. They care about their clients, and it definitely shows. Mario
Jenice is truly a miracle worker and one of the top securities lawyers. She handled a very difficult case for us, displaying her legal knowledge, intelligence, and savviness throughout the process. I cannot recommend her enough. The quality of work from her team rivals that of corporate law firms. She was always available, extremely professional, and made sure to know all the details of the case. We were very fortunate to have been referred to Jenice and highly recommend her for any securities related legal issues. Nathan A.
An excellent professional who represented us in trial regarding a bank fraud, an unexpected and difficult time. A professional that worked hard, persevering and who stood toe to toe against firms that had a team of excellent lawyers backing them up. Her unflinching determination really stands out, it makes you feel you have someone who really cares about trying to recover what you lost from the people that wronged you. Salomon Levi
It is difficult to thank you in words when gratitude comes from the heart, so I will try to link feelings with writing. It is essential for us to mention your excellence as a professional, your aptitude on legal fields, and your unavoidable persistence. All of these virtues that elevate the profession you exercise in such an admirable way, go hand in hand with your sense of ethics, your human warmth and the transparency in your actions. To sum up, thank you for being a listening ear and for having the right word while transmitting information about the legal process. Having you as our representative during such an adverse situation was a privilege and enough reason for our eternal gratitude. Angeles Aparain
To say that my securities litigation was complex would be a severe understatement. With multiple parties involved and spanning many years, trying to understand the issues was daunting to say the least. Jenice and her team broke down the transactions by segment and by party uncovering every hidden expense. In the end, I was more than happy and could not thank Jenice and her team enough. I would not hesitate to recommend Jenice to anyone. She is highly professional, incredibly knowledgeable, well connected to industry experts, has a tireless work ethic and is so pleasant and easy to communicate with. Five stars for sure! Andrew Loughrane