Individuals involved in the financial industry can run afoul of regulations pertaining to disclosure in a variety of ways, even when they are dealing with matters that seem unrelated to the securities world and do not involve industry sales practice issues. A significant number of these problems stem from failing to make mandated disclosure of reportable events on the Form U4.
Lawyers working in other areas of the law might expect that brokers and advisors would understand their own disclosure obligations. But, many do not, or are confused about the practical application of the rules. Many non-securities lawyers discover too late that trusting their clients to know their professional obligations is expecting too much. For many financial professionals, there seem to be too many rules and regulations. But the unsuspecting lawyer can find himself or herself in a jam if they fail to advise their client of key disclosure requirements, so that the broker or advisor does not face an enforcement action with very serious - or even catastrophic - consequences to the broker or advisor's career.
The attached article provides an overview of U4 disclosure issues for non-securities lawyers, and was recently published in the Gwinnett County Bar Association newsletter. Download Broker Disclosure Issues for Non-Sec Lawyers (4-2013). Of course, this is for informational purposes only and is not legal advice for any specific situation.