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Guest Post: How Does FINRA Lose 8 Hours of Testimony? Wall Street’s “Kangaroo Court”

Tyler Durden's picture


Submitted by Larry Doyle of Sense on Cents

How Does FINRA Lose 8 Hours of Testimony? Wall Street’s “Kangaroo Court”

I will admit that having written extensively and aggressively about Wall Street’s self-regulator FINRA over the last three years, I did not think there was anything more I could see that would surprise me.

Today I am surprised, shocked, and saddened.

For those in our nation who have a semblance of decency and a desire to see due process reflected in legal hearings and financial arbitration, I believe you will be similarly dismayed.

The case to which I will refer strikes deep into the core of Wall Street arbitration.  

I hope you are sitting down and do not have any sharp objects nearby as Dow Jones’ Al Lewis provides a scathing expose of a FINRA arbitration entitled Broker Bankrupted in Kangaroo Court,

Mark Mensack joined Morgan Stanley (MS) in 2008, landing an $873,000 signing bonus, but now he’s in personal bankruptcy and just moments away from losing his home in Cherry Hill, N.J.


He’s turning 50. He’s got a wife and three kids. And this is where he’s landed after losing an arbitration with his former employer before his industry’s self-regulating body, the Financial Industry Regulatory Authority.


Mensack claimed he was forced to leave Morgan Stanley after he accused the firm of taking hidden fees from its retirement-account customers. In July, a Finra panel ruled against this would-be whistleblower and ordered him to pay Morgan Stanley $1.2 million, essentially demanding most of his bonus back after quitting, plus interest and legal fees.


It is extraordinarily difficult to successfully appeal a Finra ruling. It is even more difficult when Finra mysteriously loses several hours of recorded testimony.


Mensack told me that when his attorney requested recordings for an appeal, Finra wouldn’t produce them. He said he eventually learned eight of about 18 hours of testimony from his case were missing. He sent me audio files that were inexplicably cut off at the end. He also showed me a Jan. 13 letter that Finra regional director Katherine Bayer wrote to his attorney. It said:


“Finra is required to make a…recording of every hearing. …Unfortunately, portions of testimony returned to us by the panel are missing. …I apologize for this and any perceived miscommunications from the Finra staff about the status of the recordings. …I understand Mr. Mensack’s disappointment with the arbitrator’s decision. However, Finra has no authority to reverse the award.”


A Finra spokeswoman declined to comment on the case.

The plaintiff’s charges of Morgan Stanley effectively double dipping into its 401-K accounts is obviously a very serious allegation. If I were a Morgan Stanley 401-K customer, I would be on the horn to my representative TODAY.

Those charges are NOT the main point here.

If there is supposed to be a whiff of justice and fair dealing in our nation, then each and every plaintiff is entitled to a fair hearing and a full record of testimony.

The fact that FINRA cannot and did not provide the full testimony of his hearing to Mr. Mensack renders the FINRA arbitration process as nothing more than a kangaroo court.

Richard Ketchum and his cronies at FINRA can talk all they want about progress on the financial regulatory front.

If they want to have a scintilla of credibility with the American public then they should go back and rehear Mr. Mensack’s case AND this time make sure that ALL of the testimony is properly recorded and provided for all the parties involved.

Statements such as,

 …Unfortunately, portions of testimony returned to us by the panel are missing. …I apologize for this and any perceived miscommunications from the Finra staff about the status of the recordings…

may work in kangaroo courts of third world nations but last I checked, this is America.

This smells.

Losing 8 of 18 hours of testimony?……America?………Really?

Come on Mr. Ketchum, you have work to do here.

Reopen the case.

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Tue, 03/13/2012 - 20:18 | 2252424 SheepDog-One
SheepDog-One's picture

Fukin cesspool.

Tue, 03/13/2012 - 20:50 | 2252518 Caviar Emptor
Caviar Emptor's picture

Yes! It's a murky pool made just for fornicating

Tue, 03/13/2012 - 21:01 | 2252552 disabledvet
disabledvet's picture

Looks like millions of dollars of murkiness they're swimming in to me.

Tue, 03/13/2012 - 20:04 | 2252379 pies_lancuchowy
pies_lancuchowy's picture

why the surprise? he didn't obey the Honor of Thieves , so he loses his share of the loot.. That's a very lenient punishment by the head of the gang

Tue, 03/13/2012 - 21:15 | 2252592 vato poco
vato poco's picture

Also, Why the Surprise? The clowns momentarily in charge of the guvmint - or their shadow guvmint opposition - have been pulling this shit for decades, and getting away scot-free every fucking time. JFK autopsy pics: missing. Zapruder film: confiscated, maybe altered in god knows how many different ways before its return 20 years later. The pics the kid photog took of the RFK assasination: confiscated, then 'lost'. Whoops. Sorry. LAPD physical evidence from that scene - missing. Clinton records of every kind - gone, deleted, missing. The front door at Mt. Carmel in Waco - the one with bullet holes heading INwards, proving blind fire from the ATF dipshits...lost. Sandy Berger's excellent 'docs-down-the-pants' adbventure, and he was of course never charged. Vince Foster on-site & autopsy pics: missing, blurred, vague, useless. And on & on & on. 

And don't even get me STARTED on all the missing/hidden 9-11 evidence.

Cause that's how they ROLL, Bitchez! My only question would be what kind of a shit-for-brains lawyer didn't know about this, and why didn't he make sure he had his own tape/vid recorder rolling at the procedure?

Tue, 03/13/2012 - 22:26 | 2252798 Doña K
Doña K's picture

When you blow the whistle, you first get copies of the evidence to as many TV stations and newspapers in the US and oversees as you can.

Wed, 03/14/2012 - 11:12 | 2254264 CoolBeans
CoolBeans's picture

Good thought...but it is scary how the media is ultra-controlled by the bad guys/gals.

Wed, 03/14/2012 - 01:17 | 2253075 Clashfan
Clashfan's picture

How true.


And anyone who can't see that 911 was an inside job is an idiot. Unfortunately, a lot of regulars on here fall into that category.

Tue, 03/13/2012 - 20:05 | 2252384 Heroic Couplet
Heroic Couplet's picture

Given the CDOs squared, I want Occupy Wall Street Squared.

Tue, 03/13/2012 - 20:06 | 2252385 DeadFred
DeadFred's picture

Are you really surprised? Really?

Tue, 03/13/2012 - 20:06 | 2252386 tovar2
tovar2's picture

Sounds like a legal process staight out of an old KGB file?  Unfortunately, it is going to take a lot more of these railroad jobs to get the peasants to put down their xbox and pick up their pitchforks. Then again, they would have to be privy to such strories... unfortunately these type of events never seem to get air time on the 400+ entertainment channels that are piped into the average US household. 


Tue, 03/13/2012 - 20:07 | 2252388 darteaus
darteaus's picture

You want justice?

Talk to the Godfather the day of his daughter's wedding.

Tue, 03/13/2012 - 21:00 | 2252545 Unprepared
Unprepared's picture

"Make them suffer"

Tue, 03/13/2012 - 22:36 | 2252819 palmereldritch
palmereldritch's picture

I thought Michael handled things well in the final reel...food for thought

Tue, 03/13/2012 - 23:49 | 2252965 sgorem
sgorem's picture

handled IT better in SCARFACE.......

Tue, 03/13/2012 - 20:07 | 2252391 alien-IQ
alien-IQ's picture

You seem to be operating under the misguided premise that in America there is such a thing as justice.

Stop watching movies about how things were once believed to be and look around at the real world. The only thing "exceptional" about America is the degree of fraud the banking oligarchy is allowed to commit.

If you think you're going to find justice against the banking industry in a courtroom...you are indeed the greater fool they've been waiting for.

The game is rigged. It's time to step off the court and take a few players into the alley for a bit of rehypothicated justice...old school style. (Brass knuckles are optional, brass balls are required).

Want justice? Don't ask for it, execute it.

Tue, 03/13/2012 - 20:07 | 2252393 Yen Cross
Yen Cross's picture

 No Comment. I'll hemorrhage if I do!

Tue, 03/13/2012 - 20:07 | 2252394 Likstane
Likstane's picture

FINRA is corrupt.  Wall St. is corrupt.  The US gov is corrupt.  Larry Doyle is corrupt.  All banks are corrupt.  Tyler Durden is corrupt.  Everyman is corrupt.  Your mother is corrupt.  The reader and writer of this sentence is corrupt.  The 2 month old baby is corrupt.   My second grade teacher was/is teacher is corrupt.  The pope is corrupt.  The world is corrupt.  Why is it you are surprised at the corruption?  Look at your self.  Are you somehow better?  Try and find something/someone not corrupted.  Then read the Bible.  Find someone uncorrupted. 

Tue, 03/13/2012 - 20:14 | 2252406 Cursive
Cursive's picture


Your smarmy moral equivalence is disturbing and yet another example of the social pathologies that plague American society.  A multitude of cowards.

Tue, 03/13/2012 - 20:18 | 2252422 Thomas
Thomas's picture

Yes. if I ever concede that I am corrupt, then I am at least going to use that newfound freedom to even up some scores.

Tue, 03/13/2012 - 20:34 | 2252478 Likstane
Likstane's picture

Thereby proving your corruption.

Tue, 03/13/2012 - 21:38 | 2252634 Boxed Merlot
Boxed Merlot's picture

If your point is to shame into silence, you are correct, it does and will work as an effective technique for the vast majority of people to stay silent and cash the check.

Whistleblowers typcially however have a different motivation and many times will suffer the ridicule, ostricizing and even punishment for past "corruption" as a means of personal cleansing.

Restitution is funny that way.  The proper sequence is always repentence prior to restitution, otherwise it's not restitution, it's punishment. 

Repenting is always much more difficult than restitution.  It's likely the single most difficult thing a person will ever do.  Unfortunately, there are no good secular "how to" books on the subject as winning through intimidation, blatent denial and faulty memories are so much easier to muster.

Tue, 03/13/2012 - 20:36 | 2252474 Likstane
Likstane's picture

Cursive-Do you deny your corruption? I gave you the answer.  It is no longer my problem if you deny the truth. The truth is we are all corrupt-  That is equivalence.

Tue, 03/13/2012 - 20:53 | 2252521 Caviar Emptor
Caviar Emptor's picture

Therefore if I corrupt your kids I'm doing them and you a favor 

Tue, 03/13/2012 - 21:01 | 2252551 Likstane
Likstane's picture

Caviar Emptor-I just told you my kids and myself are corrupt already.  Why would you think you have the power to corrupt them anyway?  It sounds like you need to get honest with yourself.

Tue, 03/13/2012 - 21:05 | 2252564 Caviar Emptor
Caviar Emptor's picture

Exactly. Then you won't mind, will you? 

Tue, 03/13/2012 - 21:45 | 2252670 nmewn
nmewn's picture

While it is true everyone has at least a drop of larceny in their soul, it doesn't mean they are corrupt.

Some just take a ball point pen home from work. Others order two printers or see one sitting on a shelf as backup and take it home.

Degrees of larceny/corruption perhaps, but indentifiable.

Tue, 03/13/2012 - 21:50 | 2252686 Likstane
Likstane's picture

mnewn-you are corrupt also

Tue, 03/13/2012 - 21:54 | 2252697 nmewn
nmewn's picture

Yes, but I could be so much worse if I really wanted.

You'll have to trust me on that ;-)

Tue, 03/13/2012 - 22:03 | 2252725 Likstane
Likstane's picture

Maybe my motivation for posting about the shock of corruption was corrupt!

Tue, 03/13/2012 - 22:51 | 2252856 palmereldritch
palmereldritch's picture

Or maybe your motivation is just to randomly/specifically threadjack ZH topics with wak shat?

Wed, 03/14/2012 - 11:09 | 2254247 CoolBeans
CoolBeans's picture

Social services is looking for you...

Tue, 03/13/2012 - 21:00 | 2252547 Cursive
Cursive's picture


Are you going biblical on us?   (channeling the evangelical minister): "We are all sinners!  Every! Damn! One! Of! Us!"  Well, brother, I agree that we are all imperfect and I agree that the greatest tragedies in human history were perpetrated by men who believed that the human condition could be perfected.  We will never have Utopia/Heaven on earth, but that doesn't stop us from trying to be good and decent people.  Aristotle and St. Paul could agree on that and it is all I've ever tried to do.  I would rather transcend my baser instincts than to make trifling arguments to excuse my wrongdoings.

Tue, 03/13/2012 - 21:11 | 2252578 Likstane
Likstane's picture

@cursive- You may agree we are imperfect, but you and most others will not agree with the Bible and call yourself what you are.  You are a thieving, lying, murderous, adulterous, wretch.   You and your people are not "good and decent".  The corruption is in you-to the bone(you will not transcend your baser instincts/your instincts are corrupted), and only after you admit that are you able to find real life outside of your corruption and in the life of someone uncorrupted. 

Tue, 03/13/2012 - 21:29 | 2252630 vato poco
vato poco's picture

@Likstane - exactly what purpose does your ostensibly humble but in fact proud & public flagellation serve other than your own self-aggrandizement? "You are a lying, murderous, adulterous wretch". WTF is that shit? Do you seriously think that by channeling Cotton Mather & Johnathon Edwards that you're going to carry the day here? Or are you just an (odd) corporate stooge in a basement cubicle at Goldman posting this horseshit for $6/hour, trying to peddle the (quite) old-fashioned notion that heinous sinners such as us, doomed to an eternity screaming in the lakes of Hellfire, have no right to criticize our governmantal/corporate/bureaucratic/regulatory Masters?

Are you suggesting we hush up and devote ourselves to being good darkies, and Know our Place? 'Cause that's sure what it sounds like. "Criticism of our shepherds is a sin of Pride!" Interesting message there, pard. Who, I wonder, would benefit most from the unruly mass of troublesome, uppitty proles adopting this attitude?

Wed, 03/14/2012 - 00:11 | 2252669 prains
prains's picture


what i think you mean is "take your moralistic relativism and shove it" dikstane




Tue, 03/13/2012 - 21:48 | 2252679 Likstane
Likstane's picture

Not many will benefit from the truth.  If the message is really interesting, then why wouldn't you investigate it farther instead of passing it off in cursory fashion as an old-fashioned notion?  What if I am an odd corporate stooge in a basement cubicle?  Would my personage offend you or would the message offend you?  I don't intend to carry the day, but there are a few souls that will recieve the message, and those are the ones I am speaking to.  Maybe you are one of them.  Sometimes those with the most animosity to the truth are the ones that wind up on the same side as the truth.  Don't be afraid to examine yourself and what you believe. 

Tue, 03/13/2012 - 23:53 | 2252973 sgorem
sgorem's picture

are you saying we're "dirty, filthy rags"? what the fuck is new dude? 

Tue, 03/13/2012 - 23:54 | 2252978 Goldilocks
Wed, 03/14/2012 - 00:00 | 2252938 cranky-old-geezer
cranky-old-geezer's picture



... and only after you admit that are you able to find real life outside of your corruption and in the life of someone uncorrupted.

Then what?   Finish the sentence you stupid christian moron.

On second thought I'll finish it for you since I know how you morons think.   You believe "finding your salvation in Christ" will save you.

Of course you're wrong.  Completely wrong.  Christ never said his righteousness would save anyone. 

But you'll discover it the hard way, when it's too late to alter your course

... just like all your christian moron friends will discover it the hard way, when it's too late to alter their course.

No, I'm not intrested in showing you the truth.  Go right on believing the way you do.

I'll be delighted when all you christian morons discover you're lost.

Wed, 03/14/2012 - 01:25 | 2253089 Likstane
Likstane's picture

C-O-G Thanks for finishing the sentence.  "I have kept My Father's commandments and abide in His love"-Jesus/John 15:10,   "For their sakes I sanctify Myself, that they themselves also may be sanctified in truth"-Jesus/John 17:19,  Jesus has stated in plain Aramaic/greek/english that His righteousness is EXACTLY what would save some.   I am interested in showing you the truth.  Tough way to go out, old man.

Wed, 03/14/2012 - 02:21 | 2253140 cranky-old-geezer
cranky-old-geezer's picture



Enjoy your eternity in the lowest rungs of hell moron. 

You'll have lots of company, all your christian moron friends.

Wed, 03/14/2012 - 06:50 | 2253287 awakening
awakening's picture

Either your trolling or a sinful Christian (pride in your religion and disdain for those whom chose not to follow said beliefs).


Wed, 03/14/2012 - 02:53 | 2253174 Andy Lewis
Andy Lewis's picture

Seek help.

Tue, 03/13/2012 - 23:05 | 2252894 el Gallinazo
el Gallinazo's picture

Speak for yourself.  Oh ...... you did.  OK.  Lickstain.  You are corrupt.  Let's just leave it there.

Tue, 03/13/2012 - 20:16 | 2252414 SHEEPFUKKER

Sad but true.  I guess corruption breeds more corruption, except that the rules do not apply for the most corrupt. I guess that is the worst part. 

Tue, 03/13/2012 - 21:11 | 2252575 crawldaddy
crawldaddy's picture

umm who put the king james bible together? umm that would be a bunch of corrupt religous leaders lookingto further gain and coral power.  

Looking to manmade religion is nto gonn atake you away from corruption, but actually towards it further still.

Tue, 03/13/2012 - 22:20 | 2252775 alien-IQ
alien-IQ's picture

thanks for the laugh.

Tue, 03/13/2012 - 22:22 | 2252776 CoolBeans
CoolBeans's picture

Are you still here?


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