The suitability of leveraged and inverse exchange-traded funds climbed on FINRAs Enforcement hit list in 2012, according to Partners Deborah Heilizer and Brian Rubin and Associate Andrew McCormick of law firm Sutherland Asbill & Brennans, in their annual review of the regulatory agencys disciplinary actions.
Leveraged and inverse ETFs fall under the umbrella of complex products that FINRA made a focus in 2012. In 2011, FINRA had only four cases involving ETFs, resulting in $123,000 in fines. The numbers of those cases jumped to 9 in 2012, resulting in $7.6 million in fines, an increase of 125% in cases and 6000% in fines.
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