FIA Calls for Schapiro to Resign

Two groups of small broker/dealer firms are calling for Mary Schapiro to step down.

The Financial Industry Association (FIA) and the Independent Broker-Dealer Association (IBDA) on Wednesday said they plan to conduct a member vote of confidence on the NASD chief executive and her cabinet.

The move comes on the heels of the proposed vote to merge the regulatory functions of the NASD and the New York Stock Exchange, a deal designed to eliminate duplicative rules, trim costs and lessen the inherent conflicts of interest tied to the Big Board’s for-profit status.

In a statement released today, FIA Director Richard Goble and FIA co-founder John Busacca of North American Clearing, an independent b/d in Longwood, Fla., along with Alan Davidson, president of the IBDA, declared the proposed merger “unnecessary,” citing an allegedly biased agenda that shifts the balance of power to the largest firms.

“What we have here is a sham which would provide little or no benefit to the public or NASD-member owners. The prime benefit inures to a handful of elitist insider firms who have little interest in the Public [sic],” the three declared in a joint statement.

Additionally, the FIA and IBDA argue that if the merger takes place, the 5,100 NASD members, 90 percent of whom are small businesses under the federal government’s definition, will relinquish their right to elect all of the members of the Board of Governors. They also allege that NASD has an “anti-small business agenda.”

The trio (Goble, Busacca and Davidson) wants NASD members to make a vote of “no confidence” in NASD leadership and to call for Schapiro and other high-ranking officials to resign immediately or be replaced by the board. NASD officials could not be reached for comment at press time.

For more on the FIA’s fight for small-firm representation and its opposition to the merger click here:

Small Firms Move to Block NYSE/NASD SRO Merger

http://select.nytimes.com/gst/abstract.html?res=F30711FC3A5A0C7A8EDDA80994DE404482 (New York Times, registration required)

http://online.wsj.com/article/SB116472849778234572-search.html?KEYWORDS=Randall+Smith&COLLECTION=wsjie/6month (Wall Street Journal, registration required)