Join Mitch Atkins at the FINRA Arbitration and Enforcement Regional CLE Program

Join Mitch Atkins, Founder and Principal, FirstMark Regulatory Solutions, Inc., at the Third Annual American Bar Association Litigation Section’s Current Issues in FINRA Arbitration and Enforcement Regional CLE Program. Atkins will be presenting on the third panel: In-House Insomnia:  What Keeps Lawyers and Compliance Officers Up at Night? The panel will cover key topics of relevance to compliance personnel and attorneys focusing on securities matters. The panel will cover pressing compliance concerns including:

  • Technology and Surveillance – data mining, surveillance, and reporting
  • Culture of Compliance – how it influences the day-to-day activities within a broker-dealer
  • Regulation Best Interest – what firms are doing to prepare for the June 30, 2020 implementation date
  • Regulatory Inquiries and Investigations – responding to requests for information and handling concurrent investigations
  • Regulatory Examinations – preparation for examinations, responding to inquiries, problem mitigation, and costs
  • Business Considerations in Compliance – increasing costs of burdens of regulation, changing demographics and more

The panel’s speakers include broker-dealer compliance officers, in-house counsel and outside counsel. The session takes places at 11:15 AM on Thursday, February 20, 2020 at the offices of Bressler, Amery & Ross PC at 200 E. Las Olas Blvd.,  in Fort Lauderdale, Florida.

FirstMark Regulatory Solutions provides compliance consulting services to broker-dealers and investment advisors. Founded in 2013, FirstMark provides expert advice and compliance consulting services. Areas of specialty include anti-money laundering independent testing, supervisory controls testing, FINRA membership applications, including FINRA CMA change of ownership and material change applications, among many other services offered.

Mitch Atkins has over 25 years of experience in the securities industry, having started work at NASD (FINRA’s predecessor) in the early ’90s as an examiner trainee. He worked his way up through the district office structure, working in virtually every district role until he was named the head of the Long Island office of NASD. Later, he was promoted to District Director of the Florida District Office of NASD, which became FINRA In 2007. He then became FINRA’s Senior Vice President and Regional Director covering four district offices in the FINRA South Region, overseeing regulation of approximately 850 broker-dealers. Since 2013, when he founded FirstMark, Atkins has been helping broker-dealers comply with the various SEC and FINRA Rules.

Download the brochure and register by clicking here.

Mitch Atkins to Speak at 2019 FMA Securities Compliance Seminar

Mitch Atkins, FirstMark’s founder and principal will be speaking on the Key 2019 Legislative and Regulatory Initiatives panel at FMA’s 2019 Securities Securities Compliance Seminar. The panel will take place on Wednesday, May 1, 2019 at 11:30 a.m. in Fort Lauderdale. The panel will cover areas of enforcement focus in the financial industry. Additionally, the panel will address key legislative initiatives and rulemaking that impact broker-dealers and others in the financial services industry. Topics Mitch Atkins will discuss include AML Compliance, and in particular small firm experiences with the FinCEN CDD Rule, FINRA’s 529 Share Class Initiative, including recently issued frequently asked questions published by FINRA, the FINRA High-Risk Broker (Firm) initiative, and FINRA Examination Priorities.

Other panelists will cover a broad range of topics, including cyber security, fintech, crypto enforcement, SEC’s Regulation Best Interest, CFTC priorities, FINRA’ s CAT, Rule 606, customer privacy, and others. The conference includes 14 separate panels covering a wide variety of financial industry compliance topics. The conference is being held at the Marriott Pompano Beach Hotel in Fort Lauderdale, Florida. There is still space available. To register, visit

One of the topics to be covered on the panel will include a review of small firm experiences with the implementation of the FinCEN CDD Rule which required compliance beginning May 11, 2018. The Rule mandates that covered financial institutions implement procedures to ascertain the identities of beneficial owners and a control person for certain legal entity customers. Additionally, clients must certify as to the accuracy of this information. FirstMark Solutions has recommended that small and mid-sized FINRA members who are still struggling with the requirements consider utilizing the revised FINRA Small Firm Anti-Money Laundering Template to develop their procedures for compliance with the FinCEN CDD Rule. Additionally, FirstMark Solutions has also prepared a practical guide covering the requirements of the rule, and how firms can properly implement procedures to ensure they are compliant. That guide can be found here.

Atkins Discusses FinCEN CDD Rule on FINRA AML Panel

Don’t miss the the AML Challenges panel at the 2018 FINRA Annual Conference on May 23, 2018 in Washington DC. FirstMark’s founder, Mitch Atkins, will present as a panelist. One of the key topics to be discussed is the FinCEN CDD Rule. The rule became fully effective May 11, 2018. If you’re ready, or even if you’re not, implementation questions still abound. As recently as April 2018. FinCEN issued additional guidance in the form of FAQs. This was the second round of FAQs issued on the FinCEN CDD Rule. The first round can be found here. Many firms have experienced challenges in understanding the nuances involved with the beneficial ownership requirements, including the ownership and control prong. There are numerous exceptions and interpretations to both. Also, perhaps more challenging has been the so-called “fifth pillar” requirements that involving ongoing monitoring to detect potential suspicious activity. The FinCEN CDD Rule codifies, for the first time, the requirement to conduct ongoing monitoring and to update customer information if there are red flags noted. Some AMLCOs have struggled with the concept of the fifth pillar, particularly with regard to the ongoing monitoring requirements. Questions have arisen as to whether the FinCEN CDD Rule requires that small firms implement an automated surveillance system. Guidance issued by Treasury on the FinCEN CDD Rule provides that this is not true – there is no new requirement to install a trade surveillance system. Instead, the FAQs explain that the monitoring can be done on a risk basis. However, during the course of the normal risk monitoring, if a red flag of potentially suspicious activity is noted, the customer profile that was developed based on the FinCEN CDD Rule “nature and purpose” provision should be revisited and if necessary updated. All of these issues will be addressed on the AML Challenges panel at the 2018 FINRA Annual Conference in Washington DC. If you haven’t signed up and were considering doing so, you can at this link. Also, you can view the conference video

Click on the image below to view the conference brochure:

FinCEN CDD Rule Atkins


Click on the image below to view FirstMark’s presentation materials (a practical quick reference guide to the FinCEN CDD Rule).

FinCEN CDD Rule Atkins

FirstMark Regulatory Solutions, Inc. is a compliance consulting organization based in Boca Raton, Florida. Mitch Atkins is FirstMark’s founder and principal. He focuses on broker-dealer compliance matters, including anti-money laundering independent testing, FINRA new member applications, FINRA CMAs, FINRA Enforcement litigation support, and supervisory controls testing.




AML Surveillance – Major FINRA AML Case

Yesterday FINRA settled yet another major case involving AML surveillance system deficiencies. This is one more in a series of cases in which FINRA has found that a broker-dealer’s electronic surveillance systems were insufficient to detect potentially suspicious transactions. In this case, FINRA fined the firm $13 million (which was duplicated by the SEC bringing the total sanction to $26 million) for failures related to an automated system the firm used for monitoring transactions for potentially suspicious activity. In 2010, firm connected the system to a larger, enterprise-wide system that risk-scored the results in such a way that limited the reviews of alerts from the original system. This means that, according to the settlement document, for a four-month period, the firm did not investigate suspicious activity detected by the original system. It appears from the settlement language that the firm believed its system was generating too many “false positives” and during a transition period simply determined not to investigate those items. All in all, it seems that the firm failed to investigate 1,015 instances of potentially suspicious activity.  The firm designed the system parameters such that it also excluded multiple occurrences of potentially suspicious money movements that involved high-risk counterparties and entities only once. Thus, because there was no linkage between related accounts, it did not consistently identify or monitor these customers, which apparently included some in high-risk jurisdictions and who were senior foreign political figures (PEPs). Also, quite interestingly, the settlement states that millions of accounts were excluded from the firm’s automated monitoring system.

This case is an obvious demonstration of FINRA’s increasing ability to conduct highly sophisticated AML investigations. FINRA’s last several major AML actions have sought progressively higher fine amounts for failures to adequately implement AML surveillance technology. No doubt, the investment in staffing and technology to address this issue proactively would have cost less than $26 million. But of course, hindsight is always 20/20. That said, the message is abundantly clear. It is time to invest in top-notch AML surveillance systems. And, such an investment is not simply the installation, but the ongoing periodic maintenance, which in the industry is often called tuning. It is also important that firms utilizing AML surveillance systems employ experts in FINRA AML requirements to ensure that the systems are tested and tuned in a manner similar to that which is performed by FINRA.

Finally, I have previously explained that while tuning is an important aspect of the maintenance of AML surveillance systems, it is important to take a measured approach to managing false positives generated by these systems. On one hand, false positives are a fact of life with AML surveillance systems. However, changes to rules and thresholds that are not validated or tested by experts against prior results can end up causing costly mistakes. I’m a firm believer in eliminating as many false positives as possible, because by their nature a good percentage of them are just noise and interfere with proper AML surveillance and detecting potentially suspicious activity. I’ve written about this before.  However, I worry that FINRA actions such as this will have a chilling effect on those firms wishing to fine tune these systems. I fully support modification of thresholds and rules to result in the maximum efficiency of the AML surveillance system overall. Also, it often makes sense to implement enterprise-wide surveillance. As with many things, however, this case illustrates that the devil is in the details.

Mitch Atkins, CRCP is the founder and principal of FirstMark Regulatory Solutions, a compliance consulting organization based in Boca Raton, Florida that specializes in AML compliance.


Mitch Atkins Presenting at FINRA South Region Conference

Mitch Atkins, founder and principal of FirstMark Regulatory Solutions, will present at the FINRA South Region Compliance Seminar in Fort Lauderdale, Florida on December 6, 2017.  Mitch Atkins will present as a panelist on FINRA’s panel entitled Writing and Maintaining Written Supervisory Procedures. The panel will discuss the FINRA’s Supervision Rule (Rule 3110), and in particular, best practices for developing effective supervisory and compliance procedures. As a panelist, Atkins will discuss the regulatory requirements for procedures, and will provide take-away resource materials to attendees that will serve as a guide for developing procedures, including procedures for FINRA’s new Rule 2165 on financial exploitation of seniors/specified adults.

One of the most commonly cited violations on FINRA examinations is the failure to develop and implement adequate written supervisory procedures (“WSPs”). Beyond simply satisfying regulatory requirements, effective WSPs are a compliance tool that broker-dealers utilize to delegate responsibilities for compliance with FINRA and SEC rules. Additionally, effective WSPs do more than simply state the requirements of a particular rule, rather, they serve as a blueprint of the firm’s supervisory system. A supervisory system collectively includes the processes, technology, personnel and related documentation. Before engaging in the development of WSPs a firm should first carefully consider all aspects of an overall supervisory system. Lastly, an effective supervisory system includes clear lines of authority. There have been numerous regulatory enforcement actions which cited firms for failure to designate authority, or worse, in which a problem arose, but the lines of authority were blurred such that nothing was done to correct the problem. In some of these cases, the identification of the problem was not the issue so much as who was responsible for the resolution of the issue. These issues will be covered by the panel, which includes industry and regulator participation. The FINRA South Region Conference is a cost-effective way to gain additional knowledge in this and many other areas.

To register, please visit 

FirstMark offers a broad range of compliance consulting services, including AML independent testing, Rule 3120 supervisory controls testing, SRO relationship management, FINRA membership applications, training, and more. Mitch Atkins founded FirstMark in 2013.

For more information and to view the seminar brochure and agenda, simply click the image below.

mitch atkins finra

Update: To view the session materials, click the image below:

Epic BD AML Compliance Failure Yields Another Record Fine

On Monday, December 5, 2016, FINRA announced yet another record fine against a broker-dealer for AML compliance failure. This action follows another just seven months ago in which FINRA fined a broker-dealer complex $17 million for AML compliance failure. There are numerous messages here which you can read about in my LinkedIn article that analyzes the new case. The bottom line here is to remember that the days of a slap on the wrist for a firm with a serious AML compliance failure are over. FINRA has demonstrated that it will not hesitate to slap a broker-dealer with a significant sanction, and even to name individual AML compliance officers if violations are serious. There are parallels between this case and FINRA’s May 2016 action against a Florida BD complex. Read my summary of that case here.

The case involved several significant areas of compliance breakdowns. The firm utilized and automated surveillance system, but according to the FINRA settlement document, the data feeding into the system was inaccurate and/or missing information critical to its proper functioning. FINRA also found that the system did not utilize scenarios to detect specific types of activity that it believed the firm systems should have covered.

Another AML compliance failure was that there were deficiencies in the manner in which the firm determined ownership and saleability of microcap securities. FINRA noted that the firm was involved in the liquidation of over 3.7 billion shares of microcap issuers during its review period and earned $10.4 million in commissions from same. Because the system for determining whether the shares could be properly liquidated was inadequate, FINRA found that the firm violated NASD Rule 3010, FINRA Rule 3110, and FINRA Rule 2010.

The AML compliance failure also involved inadequate procedures covering suspicious activity reporting, and failure to conduct adequate due diligence on foreign financial institutions that were also firm affiliates.

Atkins in Forbes: Email and Social Media Compliance

Last month in New York, I was invited to speak with a group of broker-dealer compliance staff at an event about email and social media compliance. More specifically, and to be technically correct, we call this “supervision of electronic communications” and you can read all about it in FINRA Rule 3110(b)(4). There, I had the opportunity to speak with Forbes contributor, Joanna Belbey. Before the event, we had a good discussion on the FINRA 2016 examination priorities and more specifically, how they relate to email and social media compliance. You can read the interview by clicking here: Mitch Atkins Forbes. See the follow-up piece to this (Don’t ‘Set it and Forget it’) by clicking here: Mitch Atkins Forbes Part II.

Email and Social Media Compliance Decrypted

After having worked in regulation for nearly 20 years, working as a consultant to broker-dealers and investment advisers has been truly enlightening, particularly in understanding the perspective of the chief compliance officer. I have had the opportunity to help design, audit and improve systems of supervision for electronic communications. What has become evident in my recent work with consulting clients is that FINRA has been very active in its email and social media compliance reviews. Today, more than ever, the term electronic communications includes far more than email. In the past, firms could be relatively confident if they had a decent email compliance system and banned the use of social media. But today, if talented advisors are not permitted to use popular communication channels, they may work elsewhere – read: competitors.

For these reasons more employers are ensuring that they have top-notch supervisory controls in place to allow the use of communication channels advisors want. To that end, firms wanting to beef up compliance might consider the following:

  1. procedures – development of clear policies and procedures covering communications;
  2. technology – implementation of a cutting edge email and social media compliance platform (but be careful and remember that simply buying the system isn’t enough – FINRA recently published an AWC in which a Chief Compliance Officer was suspended for failing to implement such a system – see FINRA Case 2014039194102 – Feb. 23, 2016);
  3. personnel – ensuring that persons tasked with conducting email and social media compliance reviews are adequately trained and that adequate resources are devoted to conducting reviews;
  4. controls requiring annual compliance questionnaires in which advisors certify their compliance with policy and disclose all communication channels they use;
  5. testing – some firms are hiring summer interns to search advisor names against social media sites (and who is better at social media?).

And finally, your keyword flagging database is the key (no pun intended) to the effectiveness of your supervisory system. Make sure that the database is reviewed frequently, that it is dynamic and evolves with both the business of the firm and the changing times. See my LinkedIn article about that for more details.

Mitch Atkins is Founder and Principal of FirstMark Regulatory Solutions, a broker-dealer and investment advisor compliance consulting practice in Boca Raton, Florida. Contact Mitch at 561-948-6511.


Mitchell C. Atkins to Present at 21st Annual Spring Life Settlement Conference

mitchell c. atkins

Mitchell C. Atkins, FirstMark’s founder and FINRA broker-dealer consultant will present on the fiduciary duty of agents and advisors at the 21st Annual Spring Life Settlement Conference in Boston on May 5, 2015. He will discuss the obligations of registered persons related to life settlement options when a variable policy is lapsing or is surrendered. Some states require disclosure of life settlements as an option, but this is not universal. Many customers who lapse or surrender a life insurance policy receive less money than if they considered a life settlement. The panel will address where there is an obligation under a fiduciary standard or FINRA Suitability Rules, and how recent DOL proposals regarding the fiduciary standard might impact life settlements. Mitchell C. Atkins has extensive experience in variable insurance products, including variable life settlements and the obligations of representatives and broker-dealers selling these products. While he was employed with FINRA (previously NASD), Atkins was designated as a national regulatory expert in mutual funds and variable insurance products by FINRA. Atkins worked at FINRA (previously NASD) for 20 years and has presented at numerous industry conferences on the topic of variable insurance. For more information about the conference, please visit the Life Settlement Association (LISA) internet site.

LISA is the nation’s oldest and largest organization representing participants in the Settlement Industry with a current membership of over 85 Companies, doing business in all fifty states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands.  LISA’s membership consists of Brokers, Providers, Financing Entities, and Service Providers to the industry.

FirstMark Regulatory Solutions was founded by Mitchell C. Atkins in December of 2013 and is based in Fort Lauderdale, Florida.  FirstMark offers a broad range of broker-dealer compliance consulting services, including AML independent testing, FINRA membership applications, internal controls testing, SRO relationship management, strategic advisory, and litigation support.

Mitch Atkins to Discuss CCO Liability at ACFCS Financial Crime Conference in New York City

Mitch Atkins, founder of FirstMark Regulatory Solutions, is presenting at the Association for Certified Financial Crime Specialists (AFCFS) 2015 Financial Crime Conference on Tuesday, April 21, 2015.  Atkins will participate as a panelist on the Financial Crime Landscape for the Securities Industry panel and will discuss recent trends in chief compliance officer (CCO) and anti-money laundering compliance officer (AMLCO) liability.  As part of the discussion, Atkins will cover recent regulatory guidance for CCOs and AMLCOs.  There will be a panel discussion on FINRA’s recent action against an AMLCO which has raised concern among those with AML compliance responsibilities.  After the discussion on CCO liability, Atkins will discuss FINRA’s continued focus on complex products as was discussed in their Annual Examination Priorities Letter. Complex products present numerous opportunities for financial crimes, particularly when the product lacks transparency and liquidity. Atkins will discuss recent FINRA cases and examination trends involving complex products, including one related to a fraudulent private placement that resulted in the bar of a broker-dealer principal and the expulsion of his firm.

Click below for a link to the conference registration site:

mitch atkins

Click here to visit Mitch Atkins‘ bio. The Association of Certified Financial Crime Specialists (ACFCS) is a worldwide organization for private and public sector professionals who work in diverse financial crime disciplines. Its membership includes compliance officers, law enforcement agents, regulators, attorneys, technology providers, and others who work to detect and prevent financial crime in all its forms – money laundering, tax evasion, corruption, fraud, cyber crime, terrorist financing, and more. FirstMark Regulatory Solutions was founded by Mitch Atkins in December of 2013 and is based in Fort Lauderdale, Florida.  Mitch Atkins is a FINRA broker-dealer Consultant. FirstMark offers a broad range of compliance consulting services, including AML independent testing, internal controls testing, FINRA membership applications, SRO relationship management, strategic advisory, and litigation support.