Marv Roffman-II

"But for Mr. [Brian] Kennedy, the call brought internal pressure and unexpected criticism. He found himself the subject of a complaint to the [SEC] brought by CardioNet and faced an in-house inquiry by Jeffries lawyers while his research was being pummeled by competitors. Mr. Kennedy's case is an example of the difficulty that analysts can face when their opinions on stocks are negative. In 2003, under federal and state pressure, securities firms agreed to rules for insulating analysts from colleagues who make big fees keeping corporate clients happy. ... Jeffries says 'sell' ratings represent 8% of its analysts' recommendations. 'Buys' make up 53% and holds 39%. ... Nevertheless, Mr. Kennedy said other senior Jeffries analysts chided him for 'rocking the boat.' ... Mr. Kennedy says his 'sell' rating came after weeks of research into CardiNet. The Conshocken, Pa., company went public in 2008 on the strength of its wireless system that sends data on a patient's heartbeat to a monitoring center for doctors. ... Mr. Kennedy quit his job in July. He says he is now considering working for an independent research shop that doesn't do any investment-banking work", my emphasis, David Armstrong at the WSJ, 20 November 2009, link: http://online.wsj.com/article/SB10001424052748704538404574542082056152414.html.

Investment-banking and retail brokerage are in inherent conflict. The SEC should prohibit firms from doing both. As for 2003's settlement, it will be as effective in producing better analytical work as the CPA industry's 1978 SAS 22, has in improving audits. Not very. This case reminds me of Janney Montgomery Scott's firing Marv Roffman in 1990, link: http://www.nytimes.com/1991/03/06/business/dismissed-in-trump-case-analyst-is-awarded-750000.html. No analyst can be independent when investment-banking fees are on the table. Any more than PWC is independent of Vampire Squid. The SEC again shows it is useless. It should have told Randy Thurman, CardioNet's CEO, "shove it up your arse", when he complained about Kennedy's call.