Financial analysts, bankers, and stockbrokers, also known as registered representatives, are held to a higher standard when it comes to the law. After all, they are put into a position of trust when it comes to their client's finances. With their client's life savings at their fingertips, the amount of damage a registered representative can do through mismanagement or fraud is enormous. That's why some criminal convictions can cost a stockbroker his or her license. These criminal convictions go beyond financial crimes; any felony and many misdemeanors can cause a stockbroker's license to be suspended or revoked.
If you are a licensed stockbroker in Houston or a licensed stockbroker in Harris County or any surrounding county and have been charged with a Texas DWI or other alcohol-related crime, you should contact a Board Certified DWI and criminal defense attorney today. A DWI conviction in Texas courts don't just put your freedom and reputation at risk; some convictions can cost you your stockbroker's license. With those consequences in mind, it's critical to contact an experienced DWI defense attorney before you even consider pleading guilty to the charges against you. After all, your DWI may be winnable with the right defense attorney by your side.
If you are a registered representative concerned about the effect a Texas DWI conviction could have on your license, contact the Doug Murphy Law Firm, P.C. today. Doug Murphy is a Board Certified expert in DWI defense and criminal defense law. In fact, he is one of only two attorneys in the State of Texas to have this distinction. Protecting your career and your freedom start with hiring a Board Certified expert to defend your rights, and your Series 7 license depends on it.
What is a Series 7 License?
The Series 7 is a license that entitles a stockbroker to sell most commodities and futures. In other words, it is the license to allow a stockbroker to make trades. To obtain a Series 7 and work for a Securities and Exchange Commission (SEC) firm, you must complete a rigorous six-hour exam that is administered by the Financial Industry Regulatory Authority (FINRA). Only stockbrokers with a valid Series 7 are authorized to sell stocks and make trades for others on their behalf.
Despite the formal-sounding name, FINRA is not a government entity. Instead, it is a private corporation that acts solely as the regulatory organization for registered representatives. FINRA oversees the licensing process for stockbrokers but is ultimately governed by the SEC. FINRA, however, won't grant a Series 7 to anyone. To obtain a license, you must meet the general requirements set out by FINRA and also successfully pass a lengthy exam.
General Requirements for Series 7 Eligibility
Not everyone can take the Series 7 exam. You must be associated with or sponsored by a FINRA-member organization or firm to be eligible. The firm will be required to file an application on your behalf, which includes with it any criminal history you have. In addition to the Series 7 exam, you must also complete and pass the Securities Industry Essentials (SIE) exam to be eligible for a Series 7 license. Your license will be terminated each time you move to a new firm, and a new licensing process must be conducted.
Disqualification of a Series 7 License
FINRA is responsible for granting Series 7 licenses, but it is also empowered to revoke those licenses under a wide range of circumstances. Pursuant to section 3(a)(39) of the Exchange Act, you may be disqualified from holding a Series 7 license if any of the following occur:
- You are convicted of certain misdemeanors and any felony within a period of ten years from the date of conviction.
- A court of competent jurisdiction issued against you a temporary or permanent injunction involving a broad range of unlawful investment activities.
- You were expelled, suspended, or barred (including a bar with a right to re-apply) from membership or participation in a self-regulatory organization (SRO).
- The SEC or other appropriate regulatory agency or authority ordered a bar against you.
- The SEC or other appropriate regulatory agency or authority denied or revoked your registration.
- It was found that you made certain false statements in applications or reports to or in proceedings before any SROs, the SEC, or other appropriate regulatory agency or authority.
It is no surprise that the potentially disqualifying event that relates to a Houston DWI conviction would be “certain misdemeanor and all felony convictions for a period of ten years from the date of conviction.”
Can a Texas DWI conviction lead to a FINRA disqualification?
Like most legal questions, the answer is “it depends.” If you are charged with felony DWI, the odds are good your license is at risk. However, while not all misdemeanor convictions mandate disqualification, the truth is FINRA has broad discretion when it comes to disciplinary actions.
Felony DWI Conviction in Harris County, TX
Under FINRA rules, you could be subject to a statutory disqualification upon the conviction of any felony. This includes a conviction at trial, pursuant to a guilty plea, or even pursuant to a no contest plea agreement. A felony conviction can be a potential disqualifying event even if the underlying crime has nothing to do with trustworthiness or financial matters. That, of course, includes felony DWI convictions. This result seems counterintuitive given that these guidelines were intended to protect clients from unethical traders.
A felony DWI conviction does not automatically guarantee your license will be suspended, however. FINRA can disqualify a currently-licensed stockbroker if it believes licensing is not the best interest of the general public. However, FINRA rules also state FINRA
may approve association of statutorily disqualified person if such approval is consistent with the public interest and the protection of investors.
Ultimately, it is at FINRA's discretion. However, practically speaking, it is not uncommon for a felony conviction to lead to a temporary disqualification.
Misdemeanor DWI Conviction in Harris County, TX
When it comes to your Series 7 license, not all misdemeanor convictions are treated the same. Misdemeanor convictions involving fraud, extortion, bribery, or other unethical activities can subject you to a statutory disqualification. In fact, merely being charged with any of these misdemeanors is grounds for losing your license. However, a conviction for DWI or other alcohol-related misdemeanor is not automatically a statutory disqualification. What's more, merely being charged with a DWI does not necessitate reporting to FINRA.
That doesn't mean that you're in the clear upon a DWI conviction, however. Just like with felonies, FINRA maintains broad authority when it comes to disqualification. If they believe that allowing you to maintain your Series 7 license isn't in the best interest of the general public, you may find yourself disqualified based solely on your DWI conviction. Unfortunately, there is no hard and fast rule that determines if your misdemeanor DWI conviction will ultimately cost you your Series 7. The best bet for protecting your license is to avoid a conviction at all costs. An experienced Houston DWI attorney may be able to have the case against you dismissed or obtain an acquittal at trial.
Do you need to report a DWI arrest or conviction to FINRA?
You have an ongoing duty to report any criminal convictions to FINRA through an updated U-4 form supplied by your firm. Keep in mind that you are only required to disclose convictions except in cases involving fraud, extortion, bribery, or other unethical activities. In those cases, you must report merely being charged with those crimes. Supplying false information or omitting material facts from your criminal background to FINRA is also a disqualifying event that will likely cost you your Series 7 license.
Because of the potential penalties as well as the social stigma associated with a DWI conviction, it may be tempting to try and hide your criminal record. This is never wise, as even the most basic background check will reflect your conviction. What's more, your firm may face severe consequences if falsify documents or mislead FINRA. That could have consequences that last longer than your license suspension, as losing the trust of your firm could render you unhireable in the future.
A DWI Defense Attorney You Can Trust in Houston TX
If you rely on your Series 7 license to make your living, a conviction for DWI could have a devastating impact on your life. There is no guarantee that a misdemeanor plea won't ultimately cost you your license once you report the conviction to FINRA. Thankfully, it is possible to win your DWI case. If you have been charged with DWI in the Houston area, the Doug Murphy Law Firm, P.C. is ready to help you defend yourself.
Doug Murphy is a seasoned trial attorney that understands the value of having your day in court. He has a proven track record of obtaining favorable results for his clients. Doug Murphy approaches every case as if it will be a trial. His aggressive approach and his status as one of only two Texas attorneys board-certified as an expert in both DWI defense law and criminal defense law have made Doug Murphy one of Houston's premier DWI defense attorney. To discuss the merits of your case, contact the Doug Murphy Law Firm, P.C. for a free consultation today.