FINRA, the primary regulator for more than 3,000 brokerage firms, on Tuesday released its annual regulatory overview of the industry and among the topics covered in the report were generative artificial intelligence, or GenAI, cybersecurity and cyber-enabled fraud; manipulative trading in small-cap, exchange-listed equities; and third-party risk landscape.
Conspicuously absent from FIRNA reports, called the 2026 FINRA Regulatory Oversight Report, was any mention of two gigantic investor frauds that have recently been in the headlines: GPB Capital Holdings and GWG Holdings Inc.
In 2024, the founder of GPB Capital was found guilty of five fraud charges in his management of the firm, which launched in 2013 and raised $1.8 billion from private investors by selling private placement through broker-dealers.
This May he was sentenced to 7 years in prison in federal court in Brooklyn. Shockingly, President Donald J. Trump last month commuted Gentile’s sentence, leaving many in the financial advice industry in disbelief.
Meanwhile, the Department of Justice last month charged another senior industry executive, Bradley Heppner with five counts, including securities and wire fraud, related to a scheme to steal $150 million.
Heppner is the former chair of GWG, which sold bonds backed by life insurance policies via a network of broker-dealers, and a related company, Beneficient.
GWG bond investors have incurred $1 billion in losses, according to the Department of Justice.
“There’s been hundreds of million if not billions of dollars of losses in those two frauds,” said Sander Ressler, managing director of Essential Edge Compliance Outsourcing Services. “How much investor money was lost in those technology heavy issues?”
“I wish that FINRA’s comments had a greater focus on the individual investor before the discussion of high level technology issues,” Ressler said. “FINRA’s mandate is investor protection. Look at those two giant frauds. Those directly affect investors.”
“The number one problem for the industry is elder fraud and what these firms are doing to protect those clients,” he added.
“Our 2026 FINRA Regulatory Oversight Report captures important findings and translates them into practical guidance our member firms can act on immediately,” said Greg Ruppert, executive vice president and chief regulatory operations officer at FINRA, in a statement. “We are not just identifying risks, we are equipping our member firms with the intelligence and resources needed to mitigate risks effectively. By sharing these insights, FINRA is engaging with members to help strengthen their defenses.”
The report contains a topic dedicated to “Senior Investors and Trusted Contact Persons” which contains information on FINRA resources and workshops to help with awareness about many tactics that FINRA is currently seeing targeted at senior investors and effective practices to mitigate these elder fraud attempts, a FINRA spokesperson noted, adding that FINRA also provides extensive resources specifically intended to educate investors, including regarding investment fraud and third-party frauds.
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