I stole this in 1989, but I won’t steal your securities.

If you and your drunk college friends were charged in 1989 for swiping a Bob’s Big-Boy statue and putting it on the 50-yard line, chances are you look back now and chuckle at your youthful indiscretion. That is, unless you are a financial advisor, in which case your public BrokerCheck report carries a constant reminder of this ancient incident: 1989 Felony Charge, Grand Larceny. BrokerCheck never forgets and it errs on the side of disclosure.

The idea is to protect investors by providing background information on financial advisors. In addition to criminal matters, BrokerCheck tracks and publicizes customer complaints, customer lawsuits, regulatory actions and reasons for certain employment terminations (reported on Finra Form U5). Criminal disclosures often relate to mere charges, can be described in embarrassing language and are difficult to remove — a situation parodied with some humor here. This issue may soon become more acute: FINRA proposed a requirement that advisors add a reference and a link to their BrokerChecks on their business websites (currently the reports are available only on FINRA’s website). [Read more…]