DeWaay Financial Network LLC, one of several broker-dealers being sued by the trustee for DBSI Inc.’s private-actions trust, may pay the ultimate price for selling the real estate firm’s deals.
Last month, claiming that bankruptcy looms, DeWaay asked a federal judge in Delaware for a temporary injunction to halt eight arbitration claims that investors have filed with the Financial Industry Regulatory Authority Inc. stemming from their losses in DBSI securities.
The DeWaay memorandum raising the specter of bankruptcy was one of several filings in a case that began in July when the DBSI trustee, James Zazzali, sued DeWaay and five other broker-dealers that sold DBSI deals.
The Financial Industry Regulatory Authority (FINRA) is a self-regulatory organization that plays a critical role in overseeing U.S. broker-dealers and protecting investors. Established in 2007 through the consolidation of the National Association of Securities Dealers (NASD) and the regulation, enforcement, and arbitration operations of the New York Stock Exchange (NYSE), FINRA operates as an independent, non-governmental entity. Its primary mission is to safeguard the integrity of the securities industry by enforcing rules that ensure fair and ethical conduct among broker-dealers and their registered representatives.
FINRA’s responsibilities include writing and enforcing rules that govern the activities of its member firms, conducting examinations and audits to ensure compliance with these rules, and administering a dispute resolution forum for investors and broker-dealers. Through these activities, FINRA promotes market transparency and fosters investor confidence.
Investor education is another key component of FINRA’s mission. The organization offers a wealth of resources to help individuals make informed investment decisions and recognize potential fraud. Additionally, FINRA maintains a public database, BrokerCheck, which provides detailed information about brokers and brokerage firms, including their professional backgrounds and disciplinary histories.
By maintaining a robust regulatory framework and emphasizing investor protection, FINRA plays an essential role in the stability and integrity of the U.S. securities markets, ensuring they operate fairly and efficiently for all participants.