Outside In

What does Heidi Klum say? "You are either in or you are out." It's one or the other, and the other goes home.

In years past this distinction for me has been clear: as an "outside consultant" to securities firms, I've always been treated that way by regulators--as an unwelcome outsider. I remember a few years ago, standing at a gas station in Some City, USA, on business travel. I was on my cell with a District liaison, fighting to get information from her about a rule interpretation or some such other clarification. My purpose was to assist my BD client--not to waste the liaison's time to build my personal knowledge base. I was speaking to the subject without divulging the client's name--that would have defeated my client's purpose at the time. Anyway, this experience was similar to many I've had over the past 8 years as a consultant: I act as a go-between in order to help my BD clients better meet Finra's Rules, and I'm shut down in the process by Finra staff due to a procedure they put in place that requires, without exception, the caller to identify the member firm's name when making inquiries.

I'm happy to say that my recent interaction with some Finra staff members has strayed from this model. I've been treated to assistance by folks in various offices--such as District offices and the Office of General Counsel--without the bias I was used to confronting. A great guy in Advertising has been helpful on several occasions. A kind examiner in NYC has been generous with his time. I haven't been made to feel like a spy or a cheater when engaging in intelligent dialogue. I'm hoping this trend continues. While I understand the old mantra, 'firms can call us for information without raising red flags or risking retribution...,' I also understand that many small firms simply prefer to avoid that direct contact. They'd rather have someone like me act as an information gatherer and interpreter. In my opinion, the result is the same (and mutually desirable): BD's are well-informed and better able to meet their responsibilities. The means to that end should not be restricted. It is in the investing public's best interest to let information/guidance/interpretation flow to BD's and their consultants.

I also want to thank some Finra staff members for their good-natured, prompt and extremely helpful assistance to me in months past...I won't name them, but the folks in the online learning and waiver departments are good at what they do and pleasant to work with. Thanks to all of you!

So, Heidi, am I in or am I out? I think for the time being, I'm a little of both. And on this particular reality show, that means I'm a winner.