Penalties for Market Manipulation
Chapters in this video
- 0:00 Riley the Representative meets the three bosses
- 0:46 SEC civil penalties: disgorgement and injunctions
- 2:57 DOJ criminal penalties: 20 years and the $5M vs $25M fine trap
- 4:35 FINRA sanctions: censure, expulsion, and the permanent bar
- 5:37 Surviving the SIE exam traps
- 6:21 Rapid-fire exam recap
What this video covers
- How the Securities and Exchange Commission (SEC), Department of Justice (DOJ), and Financial Industry Regulatory Authority (FINRA) can all act simultaneously for the same market manipulation violation
- Why disgorgement forces a violator to give back every dollar of ill-gotten profit, while an injunction is a court order to stop the prohibited conduct immediately
- The maximum criminal penalty for an individual: up to 20 years imprisonment and a $5 million fine, versus the $25 million maximum fine for an entity
- Why the SEC prefers civil cases with their lower preponderance of evidence standard instead of the criminal burden of proof beyond a reasonable doubt
- How FINRA can bar a person permanently from the securities industry even when no criminal charges are ever filed
- The difference between a FINRA bar (permanent, career-ending) and a suspension (temporary)
Read the full lesson, free
This video's complete written lesson is free to read in the CertFuel app, no signup wall. The complete SIE course in the app is free too, including adaptive practice questions and spaced-repetition flashcards.