PhillyDeals: Failing to keep an eye on rogue brokers

When you were a kid, did your teachers ever warn that you'd better act right, or it would go on your permanent record?

Rogue investment salesmen haven't had to worry about that.

The Financial Industry Regulatory Authority (Finra) has been routinely removing even career-ending "final actions" by the Securities and Exchange Commission and other federal and state regulators from BrokerCheck, the online database that is supposed to record disciplinary actions taken against brokers.

Finra administers this service, but two years after brokers lose their licenses or let them expire, BrokerCheck removes their names.

Well, some of those troublesome ex-brokers continue to work in financial services in other ways. But you won't be alerted to their problematic pasts because of BrokerCheck's practice of purging their names.

In a filing yesterday with the SEC, Finra admits that "formerly registered persons" who have lost or given up their licenses may still "work in other investment-related industries or attain other positions of trust, and about whom investors may wish to learn relevant securities-related disciplinary information."

So it has proposed making "final actions" part of an ex-broker's permanent record.

This follows Finra's embarrassment in several high-profile cases, including Nicholas Cosmo, of Hauppauge, N.Y., who federal authorities say defrauded 1,500 customers in a $400 million pyramid scheme uncovered two months ago but 10 years after he was barred from the securities business for theft of customer funds.

Similarly, former NFL standout Michael Vick, (who has enough problems) never realized his financial adviser, Mary Wong, had been barred from the business by the New York Stock Exchange, five years before he accused her of taking or wasting $2 million of his money, according to a lawsuit he filed in February.

"We know of people who migrate from this industry to hedge funds, financial planning, banker jobs, where they're not under our jurisdiction," and the records disappear from the database, Finra spokesman Herb Perone told me, citing the Cosmo and Wong cases, among others. "We're asking to make those regulatory actions permanently available to the public through BrokerCheck," he said.

Before we get all grateful, let's remember, as Finra also admits, that information about broker busts is already available through "online search engines, regulators' Web sites, and fee-based services such as Lexis or Westlaw," for people willing to check through all that.

It's just Finra's BrokerCheck that pretended they never happened. Nice to see Finra join the online era.

When the Eagles made the NFL playoffs last fall, Comcast pitched Wawa "a wonderful opportunity to do some advertising," said Lisa Wollan, head of consumer insights and brand strategy at the Media-based convenience-store chain.

But "it was the very last minute," Wollan said, and Wawa's national ad agency, Richards Group, of Dallas, reminded her "it's way too expensive to do a new TV commercial for 15 spots on Comcast SportsNet."

So Wawa went online, to Archer Group, an Internet marketing agency in Wilmington, better known for servicing financial clients (they recently put together an iPhone application for Chase Card Services).

Todd Miller is the creative head at Archer and his team put together a simple "chalk-talk" cartoon series promoting Wawa hoagies. "These guys grew up local, so they understood our brand, and they understood the Eagles' feel," Wollan told me.

Archer was started by Lee Mikles (formerly of Insight Interactive Group) and Patrick Callahan (formerly of Accenture) six years ago in the sleepy-funky 200 block of North King Street. The firm has nearly doubled in size this last year, to 35 people from 20, and has taken a second floor in an airy brick Buccini/Pollin Group building.

Archer also helped Wawa's national agency relaunch Wawa.com last year, putting Richards' '60s-vibe Hoagiefest ads into "a site that would make those features move and touch," said Wollan. "They found a guy who developed these Beatles-like lyrics. They did four spots that were so good we used them on the site and a microsite."

They did more of the same for Wawa's Coffeetopia promo last fall. Archer also set up Facebook accounts for Wawa executives, then sold them on Facebook widgets that make it possible for customers to send each other virtual hoagies. "Like you'd send a virtual hug," Wollan said.