Last month, Sallie Krawcheck was elected to one of three large-firm governor's seats at Finra. There's just one hitch. Now that Krawcheck no longer works for BofA, she must quickly find a job at a large firm — or give up the seat.
It may not be her biggest concern right now, but the now unemployed Sallie Krawcheck will have to land a new gig at a large brokerage firm or resign her newly won seat on Finra's board.
Early last month, Ms. Krawcheck was elected to one of the three Financial Industry Regulatory Authority Inc. board seats reserved for representatives of large member firms. But Tuesday, the former head of Citigroup Inc.'s wealth management unit was ousted from her job as president of Global Wealth & Investment Management at Bank of America Corp.
The departure from BofA put Ms. Krawcheck's Finra status in jeopardy. "If Ms. Krawcheck affiliates with another large firm within a short period of time, she can remain on the board,” Finra spokeswoman Nancy Condon wrote in an e-mail. “Otherwise, a special election will have to be held."
Ms. Condon could not say how long Finra might wait, but added that the issue will be a topic of discussion at Finra's next board meeting, which takes place later this month.
This is not the first time an industry board member was fired, nor would it be the first such special election.
In 1998, Jamie Dimon, then a president of Citigroup and an industry board member of Finra's predecessor, NASD's regulatory unit, was ousted from Citigroup at the same time he ran for re-election to NASD's board.
Mr. Dimon, now chief executive of JPMorgan Chase & Co., lost out in that race to several other candidates in what was then NASD's first contested board election.
A decade later, Finra had to hold a special election to replace a seat vacated by Richard Goble, owner of North American Clearing Inc., who resigned from the board after the Securities and Exchange Commission filed a complaint against him and his firm.
The 22-person Finra board structure was reorganized in 2007. It now has three small-firm governors, three from large firms and one from a midsize firm.
