Tracy Stoneman - Stoneman Law
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Stockbrokers

A stockbroker is easily definable, because it necessarily means that the individual is licensed and employed by a brokerage firm. Licensed stockbrokers cannot hang their shingle under their own name; they must be employed by a brokerage firm. FINRA reports on the statistical page of its website that it is responsible for regulating 630,000+ brokers. All of those brokers are employed at one of the 3,700+ brokerage firms, that are also regulated by FINRA.

Stockbrokers, like other professionals such as doctors, certified public accountants (CPAs), and lawyers are required to have licenses to conduct business. To become a medical doctor, one must spend the better part of a decade between schooling and residency in order to become qualified. Lawyers must attend three years of law school and pass a rigorous exam in order to become qualified. To become a CPA, most states require a college degree and a number of years of experience.

Unlike doctors, lawyers, and CPAs, stockbrokers need have no special schooling or training to be hired by a brokerage firm. New stockbrokers need not have financial credentials or experience. In a book I co-authored called Brokerage Fraud What Wall Street Doesn’t Want You to Know, there is a section of a chapter entitled “Broker Qualifications – Did Your Broker Go To College?” He or she may not have. As we stated in the book, “The following is a list of qualifications that brokerage firms look for when hiring someone who has not previously worked as a stockbroker:

  • The ability to sell
  • The ability to sell
  • The ability to sell

The title of the chapter is “Stockbrokers Are Salespeople”. Stockbrokers are paid, incentivized, and provided titles based on how much commissions they can bring in for themselves and the firm (the commissions are shared between the broker and the firm). Qualifications that firms look for in a prospective employee stockbroker include great communication skills - someone who is confident, slick, vocal, gutsy. Prior “selling” experience is helpful, even if it was selling encyclopedias door-to-door.

Stockbrokers advance within a brokerage firm by, again, how successful they are in bringing in revenue to the firm, which translates into buying and selling investments in customer accounts. Most of the training that stockbrokers receive upon being hired at a brokerage firm consists of sales training. A new broker will also be required to pass the Series 7 exam, also known as the General Securities Representative License.

A grade is given for the exam, but the only score that matters is pass or fail. Brokers can take the exam as many times as they need to finally pass.

A stockbroker’s revenue-generating success also impacts a broker’s title. The following are common titles that you will see on stockbroker business cards and signature lines:

  • Vice President
  • Vice President Investments
  • Vice President Trading Specialist
  • Vice President Portfolio Management
  • Senior Vice President
  • Senior Portfolio Manager

It doesn’t take much to become a Vice President financial advisor at a brokerage firm, as this title is given out like candy. There must be hundreds of Vice President brokers at each of the large brokerage firms.

Client Reviews
★★★★★
If you suspect securities or brokerage fraud against your hard-earned investments and need an advocate, call Tracy Pride Stoneman - NOW! I was a victim of churning, improper sale of unsuitable private placements, compliance violations, and more. I blamed myself at first and didn't think I had a case, but I was referred to Tracy after another lawyer balked, thinking all was lost. She took the emotion out of it, got down to the facts, made the case, and in hands-on fashion worked hard for the best result possible. She's an excellent communicator and the kind of experienced securities arbitration lawyer you need in your corner. Ms. Stoneman achieved a settlement for me that far exceeded expectations. She has my highest recommendation.
★★★★★
Tracy was a wonderful lawyer in my and my husband's huge case against Prudential Securities. She was relentless in going after the stockbroker and firm, determined to obtain all of the documents that helped our case and hurt theirs (that's why the firm didn't want to produce them!). No matter what curve ball the brokerage firm threw, Tracy came up with an angle to overcome it. My husband always commented how smart Tracy was in handling our case. Throughout it all, Tracy was extremely cheerful and easy to work with - unlike most lawyers I know! Carolyn W.
★★★★★
I think that you did a great job for the Tylers, and I believe you are one of the most organized and effective attorneys I have worked with. John B.