FINRA Warns Member Firms of E-Signature Violations

Posted on August 24th, 2022 at 1:35 PM
FINRA Warns Member Firms of E-Signature Violations

From the Desk of Jim Eccleston at Eccleston Law.

The Financial Industry Regulatory Authority (FINRA) has issued a regulatory notice warning financial advisor firms to closely monitor how advisors utilize third-party digital signature platforms amidst a spike in forgery and falsifications.

While digital signature tools have increased efficiency, they also come with a heightened risk of forgery or falsification, according to FINRA. FINRA noted that firms have reported issues with forged signatures from clients on account opening documents, account activity letters, and internal firm documents. FINRA recommended that firms employ digital signature tools to track Internet Protocol (IP) addresses illustrating where the document was signed. For example, firms have discovered cases where the UP address for the client e-signature and the advisor were the same.

In alternative cases, advisors had sent e-signature documents to their own emails to be signed rather than to the client. FINRA additionally recommended that firms rely on advisor support staff to monitor for potential violations.

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, advisors, law, finra

Return to Archive

TESTIMONIALS

Previous
Next

I learned two important things working with Eccleston Law. First, I made a friend and ally with Jim and Steph for life. Secondly, and this is a crucial life lesson - if you need counsel, then seek out the very best. Jim was referred to me by a most trusted source. I've never had to hire an attorney for anything. Now, I know the value of hiring an important partner. Meticulous, thorough and detailed in preparation is the best way to describe Jim. Brilliant too, I might add. Bottom line, I would highly highly recommend Jim and Stephany for your legal needs. One of the best life decisions I've ever made.

Howard S.

LATEST NEWS AND ARTICLES

July 1, 2025
State Regulators Fine Five Major Broker-Dealers Nearly $10 Million for Excessive Commission Charges

A coalition of state securities regulators has ordered five broker-dealers — including Edward Jones, LPL Financial, RBC, Stifel, and TD Ameritrade — to pay almost $9.9 million in penalties for overcharging customers on small-value trades.

June 30, 2025
SEC Charges New Mexico Investment Advisor with Fee Fraud and Fiduciary Breaches

The Securities and Exchange Commission (“SEC”) has charged David A. Nagler and his firm, New Line Capital LLC, with defrauding clients through deceptive fee disclosures and undisclosed conflicts of interest.

 

June 27, 2025
FINRA Sanctions Advisor for Accepting $1 Million Inheritance from Client Without Firm Approval

FINRA has fined and suspended veteran advisor Kenneth J. Malm for accepting a $1 million inheritance from a client without receiving the necessary firm approval.