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After a felony DUI, an advisor seeks to rejoin financial industry

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Q: A few years ago I got a felony DUI which made me “statutorily disqualified”[under Section 3(a)(39) of the Securities Exchange Act of 1934]. I’ve totally complied with all aspects of my probation, which is due to expire in a couple months. What are the chances that I could get registered with a brokerage firm?

A: FINRA may deny an application by a firm for association with a statutorily-disqualified individual if it determines that employment of the individual would not be consistent with the public interest and the protection of investors. By the same token, FINRA bylaws (Article III, Section 3(d)) say that FINRA “may approve association of statutorily disqualified person if such approval is consistent with the public interest and the protection of investors.”

Consequently, FINRA would likely require that your employer demonstrate that your association with them is in the public interest and does not create an unreasonable risk of harm to the market or investors. In reviewing this type of application, FINRA will look at all the circumstances related to the felony as well as other relevant facts. For example, FINRA would likely consider: the fact that the felony conviction did not involve securities or fraudulent misconduct; the lack of any intervening misconduct on your part; the length of time you had been registered in the securities industry without any disciplinary action or customer complaints; your accepting responsibility for your actions; and, your continued compliance with the terms of your probation.

Additionally, FINRA would consider the nature of the position your firm plans to employ you in, as well as whom your supervisor would be and their record as well. If they approve you, they would, of course, probably require the firm to craft a heightened supervisory plan for you which may, for example, include having your supervisor keep an eye on you for signs of impairment and such.

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