Back to List

What We’re Reading This Week


If you think ASC sounds a lot like SEC then you are right, but the Alberta Securities Commission is having more fun than the SEC. In February, the ASC held an investment seminar for a fake firm, Maplestock Investments. They created a fake investment to market then proceeded to promote the event on Facebook, Eventbrite, Google, and Craig’s List. They even delivered flyers door to door. The investment guru was a paid actor replete Facebook and LinkedIn profiles. 48 people registered for the event and 22 showed up. After they arrived, they were told the whole thing was faked as part of the ASC’s fraud prevention and education campaign. Apart from dodging things thrown by disgruntled seminar attendees, working at the ASC sounds great. But what does their budget look like? It seems like a lot of work to educate 22 people on investment fraud. 


Elsewhere in securities regulator news, FINRA is proposing changes (additions?) to its licensing process. FINRA claims this will streamline the process to become a securities broker, but it really sounds like it will allow financial firms to avoid paying candidates that can’t pass a series 7 exam while increasing the out of pocket costs to young people entering the industry. In today’s world, aspiring brokers must pass an exam in order to sell securities and in order to sit for the test they must be “sponsored’ by a financial company. Essentially, applicants need to work at a firm in order to take the test and firms need brokers so they are forced to hire candidates and pay them money by way of creating new brokers. Passing the test is important to both parties so financial companies end up paying young employees to sit around studying. Inevitably, candidates fail the test and the firm is out the money they fronted in terms of wages and licensing costs. Years ago, they could just send the candidate a bill but it turns out that if they candidate paid the bill the firms would have essentially paid them less than minimum wage during the time they were at the firm. Lawsuits ensued and companies do not do that anymore. Hearing that makes it hard to believe there is a shortage of young people trying to become brokers. In FINRA’s brave, new world fresh young college graduates can pay money out of their own pocket to take the Securities Industry Essentials “as an important first step to entering the industry.” Candidates will still need to take a specialized exam once a firm sponsors them, so this test really just helps financial companies avoid hiring an individual that may have difficulty passing an exam. 


Every now and then Bridgewater, a hedge fund, will show up in my RSS feeds. Mostly because the firm’s founder is a crazy person. I guess that is not accurate. When a crazy person has billions of dollars, you are supposed to call them eccentric. Recently, The Times published an interesting chronicle covering past and current snafus. In response to the most recent “awkwardness,” the firm’s founder Ray Dalio likened working at Bridgewater to visiting a nudist camp the first time, “There has to be getting over the emotional reaction.” Um, sure. I guess if your context for something incredibly weird is some other weird thing then yes, you are probably right. I am just not sure that makes the first thing less bizarre. Analogies mostly serve to make a complex idea easier to understand. Think, “Life is like a box of chocolates.”








Gainplan LLC provides links for your convenience to websites produced by other providers or industry related material. Accessing websites through links directs you away from our website. Gainplan LLC is not responsible for errors or omissions in the material on third party websites, and does not necessarily approve of or endorse the information provided. Users who gain access to third party websites may be subject to the copyright and other restrictions on use imposed by those providers and assume responsibility and risk from use of those websites.


Categories: Industry Ideas, News, The Market

Subscribe to Our Blog