Upset in FINRA Board Large Seat Election

FINRA has concluded its annual meeting of firms and has announced the results of its Board of Governors election, including in the contested large firm category.

In the vote of eligible member firms, Chris Flint, president and CEO of ProEquities Inc., defeated Andrew Duff, former board chair at Piper Jaffray & Co. and current first-term member of the FINRA Board.

In the lead-up to the election, PLANADVISER spoke with both candidates about their hopes and expectations for serving on the Board. Both emphasized their ability to leverage 20-plus years of industry experience. Both also said they are in the prime of their careers in the financial services space, so they have a strong personal interest in seeing that the FINRA Board remains a fair, effective and efficient self-regulatory institution.

Flint’s message of bringing a “retail-oriented voice” to the FINRA Board has in the end prevailed among voting firms. It also stands to reason that he benefited from the strong endorsement of several influential membership organizations in the financial services industry, including the Financial Services Institute (FSI) and the Bank Insurance and Securities Association (BISA). These are considered, respectively, to be among the leading advocacy organizations for the independent financial advice channel and the bank-based financial advice channel.

Some weeks ago, Dale Brown, CEO of FSI, noted that Flint’s candidacy represented the first time both the independent and bank-based industry associations have jointly endorsed the same candidate in a contested FINRA Board election. It was also the first time in BISA’s history for endorsing any FINRA Board candidate—let alone, a candidate challenging the incumbent.

Now, reflecting on Flint’s victory, Brown says he is proud to see this outcomes—and he expects great things from Flint.

“We were proud to endorse Chris and work hard to help bring his commitment to investor protection and fresh perspectives to the FINRA Board,” Brown says. “One of our top goals is to make the value of the independent model to investors better understood by all stakeholders. Having now helped our third petition candidate secure a FINRA Board seat in the last four years, we’re more confident than ever that strong progress is being made toward this goal.”

Readers may recall that current large firm FINRA Board member Jim Nagengast, chief executive of Securities America Financial Corp., won a seat by defeating the FINRA-preferred candidate in a special election last year. Nagengast also had earned FSI’s endorsement.

In terms of what he will prioritize as a FINRA Board member, Flint has emphasized the importance of collaboration with the Securities and Exchange Commission (SEC) during the rollout of the newly finalized Regulation Best Interest. He has also suggested he will push for “less regulation through enforcement,” based on the argument that one-off enforcement actions are not the best way to approach the transformational changes that some parties may feel are needed within financial services.