Practice/Industry Group Overview
Broker-dealers’ sophisticated legal concerns require the experienced, efficient and insightful counsel they find at Sutherland.
Sutherland provides a full range of legal services to the broker-dealer sector of the financial industry. Because many of our team members have served as in-house counsel to broker-dealers or as senior counsel at the Securities and Exchange Commission or FINRA, we have an unsurpassed knowledge of broker-dealer business activities and concerns and focus on emerging issues. We often meet with regulators to discuss cutting edge issues of concern to our clients.
We assist clients in forming broker-dealers, establishing business operations and obtaining membership with FINRA and registrations with the SEC, the MSRB and state securities regulators. We also assist clients with business reorganizations, mergers and acquisitions, including obtaining approvals of continuing membership applications in connection with mergers, changes in control and business expansions, and advising on operational aspects of integrating or spinning off business lines. We counsel broker-dealer clients on regulatory requirements and provide updates on evolving legislative and regulatory initiatives impacting their business operations.
We also routinely advise our clients on employment matters, compensation and incentive arrangements, protection of their intellectual property rights, compliance with SEC net capital, customer protection and trading and clearing rules, as well as assist them with compliance inspections, examinations and remedial corrective actions. We also have served on client compliance committees. We work closely with Sutherland’s securities enforcement team, who represent broker-dealers in arbitrations, civil litigation, and class actions.
In addition to serving a large number of broker-dealer clients, we also provide comprehensive legal services to U.S. and foreign-owned diversified financial services companies that maintain or utilize broker-dealers as part of their business platform. We develop solutions that work for multiple regulatory schemes, in recognition that affiliates of broker-dealers are often subject to different, and at times conflicting, regulatory requirements. Recognizing that many of our broker-dealer clients are also engaged in investment advisory and derivatives trading activities, we routinely draw upon our firm-wide experience with ERISA and the rules and regulations governing investment adviser, futures and derivatives trading, consumer protection, insurance, and banking activities.
Sutherland’s Broker-Dealer Practice Group is part of our larger and nationally recognized Financial Services Practice, which boasts decades of comprehensive industry experience. The full resources of our diverse firm stand ready to serve the interests of our broker-dealer clients, to prepare them for business in the future and to defend them when issues arise. Our strategy is simple: We work with clients to develop business-based solutions to meet compliance requirements and successfully manage regulatory inquiries, disciplinary and enforcement actions.
A practical approach. If a legal approach does not meet a client’s business needs, then it is not a solution—it’s merely the beginning of a new problem. We design solutions that make business sense and will work. Our approach allows Sutherland to successfully represent some of the nation’s most dynamic and successful broker-dealers with practical solutions to real problems.
We understand business. We're lawyers by profession but we possess a deep understanding of our clients' business, products and investments that enables us to aid them in meeting their strategic business objectives—whether entering a new line of business, developing compliance manuals, preparing for regulatory exams, maintaining net capital requirements, establishing new marketing and distribution arrangements, implementing trading and clearing platforms, managing communications, sales practices, or use of social media, or enhancing recordkeeping arrangements.
Regulatory sensitivity. Our team includes former counsel with various regulators, who can offer unique advice and counsel on the regulatory requirements applicable to broker-dealers in a wide variety of business models and broad experience.
Transaction experience. We know mergers and acquisitions from top to bottom—from conducting due diligence in anticipation of a transaction to obtaining FINRA regulatory approvals, to implementing the combination of broker-dealer operations, we play an instrumental role in structuring transactions to obtain regulatory approvals on a timely basis.
Knowledgeable about industry developments. Our attorneys keep abreast of legislation and rulemaking activities and often are invited to discuss issues with government agencies and self-regulatory organizations (SROs). This gives us an inside track in understanding the direction of future regulations.
Connected to trade associations. We are actively involved with the various trade associations representing the interests of the broker-dealer community, including the Securities Industry and Financial Markets Association (SIFMA), Financial Services Institute (FSI), and the Committee of Annuity Insurers.
Nuts and Bolts
We understand financial products:
- Alternative investments
- Annuities and life insurance
- Asset-backed securities
- Direct participation programs
- Equity securities
- Exchange funds
- Exchange-traded funds and vehicles
- Hedge funds
- Municipal securities (including Section 529 plans)
- Mutual funds
- Offshore products
- Private equity funds
- Private placements
- Real estate investment trusts (REITs) and real estate programs
- Variable insurance products
We work with all types of firms:
- Bank affiliated broker-dealers
- Clearing firms
- Fund sponsors
- Independent contractor firms
- Insurance affiliated firms
- Investment advisers
- Mergers and acquisitions advisory firms
- Placement firms
- Retail broker-dealers
- Retirement plan service providers
- Transfer agents
- Trading Platforms
- Wealth management firms
We deal with all types of matters:
- Acquisitions, reorganizations and restructuring initiatives
- FINRA membership and continuing membership proceedings
- New product development
- Marketing arrangements
- Compensation arrangements
- Net capital and customer protection issues
- Development and delivery of continuing education
- Recordkeeping arrangements
- Sales practices
- Anti-money laundering practices
- Outsourcing practices
- Compliance programs and written supervisory procedures (WSPs)
- Distribution of private and public offerings
- Internal investigations
- For cause and targeted regulatory examinations
- Regulatory investigations and disciplinary actions
- Investment management
When broker-dealers need sophisticated counsel for the full range of specialized legal, business and compliance issues they face, they turn to Sutherland.
Financial services company relies on Sutherland in establishing a retirement plan platform to facilitate product distribution.
Sutherland assisted a financial services company with the formation of a broker-dealer and establishment of a retirement plan platform to facilitate the distribution of insurance and investment products through unaffiliated selling firms.
Sutherland advises major financial services company in sale of its retail broker-dealer operations.
Sutherland advised a major life insurance and financial services company in the sale of its retail broker-dealer operations to another major insurer.
Sutherland works with equity trading firms and developers of trading technology.
Sutherland advises firms on clearance and settlement issues and agreements, high-frequency trading, and the development of consolidated audit trails.
Articles Authored by Lawyers at this office:
SEC Adopts Amendments to Regulation S-X Applicable to BDCs
Cynthia R. Beyea,Steven B. Boehm,Cynthia M. Krus,Lisa A. Morgan,Harry S. Pangas, December 14, 2016
On October 13, 2016, the Securities and Exchange Commission (SEC) issued a release adopting final rules to modernize and enhance the reporting and disclosure of information by registered investment companies (the Final Rules). Though the Final Rules primarily address the reporting and disclosure...
SEC Adopts Rules to Modernize Information Reported by Registered Investment Companies
Frederick R. Bellamy,Cynthia R. Beyea,Steven B. Boehm,James M. Cain,Cynthia M. Krus, December 09, 2016
On October 13, 2016, the Securities and Exchange Commission (the SEC) issued a release adopting final rules to modernize and enhance the reporting and disclosure of information by registered investment companies (the Final Rules).1 The Final Rules are part of the SEC’s initiative to enhance...
SEC Adopts Changes to Form ADV and Books and Records Rules
Eric A. Arnold,Clifford E. Kirsch,Michael B. Koffler,Susan S. Krawczyk,Holly H. Smith, September 19, 2016
On August 25, the Securities and Exchange Commission (the SEC) adopted amendments to Form ADV Part 1 that will require SEC-registered investment advisers to provide a significant amount of new information.1 The SEC adopted these amendments to Form ADV to improve the depth and quality of information...
CFTC Finalizes Rules on Cybersecurity Testing for Futures Industry
, September 13, 2016
Under new rules adopted by the Commodity Futures Trading Commission (CFTC), various entities in the futures industry must undertake cybersecurity testing. At its open meeting on Sept. 8, 2016, the CFTC amended its system safeguards rules for exchanges, clearinghouses, and data repositories to...
ISDA Publishes Variation Margin Protocol
Brian Barrett,James M. Cain,Catherine M. Krupka,David T. McIndoe,Mark D. Sherrill, August 24, 2016
On August 16, 2016, the International Swaps and Derivatives Association, Inc. (ISDA) published the ISDA 2016 Variation Margin Protocol (VM Protocol). The VM Protocol is intended as a tool to help market participants that will be subject to regulatory variation margin requirements,1 and their...
CFTC Proposes to Expand Mandatory Clearing to Include Additional Classes of Interest Rate Swaps
James M. Cain,Catherine M. Krupka,David T. McIndoe,Mark D. Sherrill,R. Michael Sweeney, June 20, 2016
On June 9, the Commodity Futures Trading Commission (CFTC) released a notice of proposed rulemaking regarding an expansion of CFTC Regulation 50.4(a). If adopted, additional classes of interest rate swaps will become subject to mandatory clearing pursuant to the Dodd-Frank Act. The proposed...
FTC Reviews Security Updates Practices of Eight Mobile Device Manufacturers
, May 17, 2016
The Federal Trade Commission is requiring eight mobile device manufacturers to provide the FTC with information about how they determine to issue security updates to address vulnerabilities in smartphones, tablets, and other mobile devices. The FTC plans to use these filings to study policies,...
CFTC Intermediaries to Adopt and Implement Cybersecurity Programs by March 1, 2016
Brian Barrett,James M. Cain,Daniel E. Frank,Daphne G. Frydman,Catherine M. Krupka, March 02, 2016
Commencing March 1, 2016, all commodity pool operators, commodity trading advisors, futures commission merchants, retail foreign exchange dealers, investment brokers, major swap participants and swap dealers that are National Futures Association (NFA) member firms (together the Covered Parties)...