Reg Rep & Bankruptcy - Help

Quote from nkhoi:

darn good counseling make me want to file b/r myself :)
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I did not mean to imply to take it lightly or even recommend it - if consolidation or something similar can be used to get the debts under control then B/R should be avoided.

But if the situation is already such that there is many late payments, collections and/or charge-offs then it doens't matter much and IMO a person is better off getting a clean start without the extra pressure of knowing they are are still deep in hock AND still have shitty credit.

I mean, a B/R vs. 5 charged off accounts that were past due 90 days +, which is worse? - The net effect on your life is the same. Both people would be in the same high risk credit category - and the longer it goes on the worse it is.

This is why most credit counseling programs and chapter 13 B/R (debt reorganization as opposed to debt discharge) just make things worse - the creditors continue to report the late payments and past due balances - they just can't send you to Collections anymore. But your credit score continues to get worse and worse.

The other thing to consider is whether or not a person can live with himself/herself knowing that they failed to live up to their obligations. For some people the guilt can be devastating. I have had people break down crying in my office as I probed them for details so I could come up with a good "story" for the loan buyers in an effort to get their loan approved.

But I just wonder if that is outweighed by all the sleepless nights and sense of doom that people in financial trouble live with constantly. Having been there myself in the past I know this firsthand. It eats away at any quality of life one may otherwise have. Sometimes you just gotta cut your losses.

I know of people that have made a point of going back and paying off the account balances that were discharged during the B/R - they did that when their fortunes improved because they felt it was the right thing to do - this also hastened their re-establishment because it displays honor and character.

Paul
 
Many SRO's(Self Regulatory Organozations) anf trading firms will not accept traders for a period of time after a bankruptcy filing. I believe it is seven years at our SRO, the PHLX. Please check with a qualified legal advisor , before filing for bankruptcy , especially if you are in the securities industry. Bankruptcy may not be your only option.


Gene Weissman
Lieber & Weissman Sec., LLC
gweissman@stocktrade.net
 
Quote from Gene Weissman:

Many SRO's(Self Regulatory Organozations) anf trading firms will not accept traders for a period of time after a bankruptcy filing. I believe it is seven years at our SRO, the PHLX. Please check with a qualified legal advisor , before filing for bankruptcy , especially if you are in the securities industry. Bankruptcy may not be your only option.


Gene Weissman
Lieber & Weissman Sec., LLC
gweissman@stocktrade.net
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Why?

What difference does a BK have? What happens to a person who is already a member and then files BK, are they then removed from the SRO or trading firm?

I don't understand? If someone has a BK or judgements against them, how would this effect thier job?

I thought people who completed a Bk were actually a better risk, cannot file BK for another 7 years?

If you do not claim this info on the U-4, how would they find out?
 
F-Trader ,

Good questions , however , I can't answer these in a general way in this forum. If you do file for bankruptcy, you probably should let your firm(prop firm) , know about it , since it should be reported to your SRO. Remember, as a prop trader, you are trading the firms capital and your membership in the prop firm is subject to SRO(self regulatory organization) approval.


Gene Weissman
Lieber & Weissman Sec., LLC
gweissman@stocktrade.net
 
desperate,

You have to ask yourself who you are before you can come up with a solution. Do you want to be self employed or work for a big firm? Would you rather make 2k a month being a day trader or 6k a month working in the industry for someone else?

Also, where you are in life is very relevant. For example if you are single and looking to "settle down" then maybe having no money and living with your folks is no big deal. If you want to do whatever it takes to become a profitable trader, then moving back home and lowering your overhead is a great idea.

Figure that part out and then you will know what the solution is. Don't make a decision on bk until you have decided the above.

Your answer will probably be somewhere in the middle. If so, then think about getting a job on a trading desk as an order taker (not trader). These jobs are easy to get but only pay $2,500 a month. That way you stay in front of the market. Then check out the succesful prop traders at your desk (most desks have prop) and see if you can get a stake and start trading your own account there. If you do well, the firm will let you trade their capital (with strict guidelines ie no more than 500 shares etc.). If you violate their guidelines you will be fired on the spot. This way you get the best of both worlds - you can trade and you have a job.
 
Quote from Gene Weissman:

F-Trader ,

Good questions , however , I can't answer these in a general way in this forum. If you do file for bankruptcy, you probably should let your firm(prop firm) , know about it , since it should be reported to your SRO. Remember, as a prop trader, you are trading the firms capital and your membership in the prop firm is subject to SRO(self regulatory organization) approval.


Gene Weissman
Lieber & Weissman Sec., LLC
gweissman@stocktrade.net
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I retired at 40, I have no intentions of filing BK-7 :p

Could you answer just in general why the SRO's do not want people with BK on their record?

It is my understanding that you cannot file BK for another 7 years after your first BK has been discharged, I thought this made these people more attractive for CREDIT.

Do firms check your Credit report for BK's?

What if you fail to report on U-4, how would anyone know?

I am amazed that someone who has gone thru BK could actually be turned down from SRO, all the CROOKS on Wall Street: Enron, Worldcon, Global Crossings, etc... get away with murder.

It sounds like someone could actually lose their career "JUST" because of a BK?

Many people file BK for medical reasons (large bills), death of spouse, divorce, etc... this rule makes no sense to me.

Just curious?
 
I retired at 40, I have no intentions of filing BK-7

Could you answer just in general why the SRO's do not want people with BK on their record?

It is my understanding that you cannot file BK for another 7 years after your first BK has been discharged, I thought this made these people more attractive for CREDIT.

Do firms check your Credit report for BK's?

What if you fail to report on U-4, how would anyone know?

SRO's probably do not want traders with financial problems , because of the potential for liability(introducing broker) or fraud by the trader who may be in financial trouble. I assume this is the reason for the SRO's concern. Firms could ask you for a credit or background check in addition to U-4 information. Generallly U-4's ask all questions that relates to a traders financial condition. If you willfully do not report acts of bankruptcy or fraud on a U-4, you could be subject to SRO and/or criminal penalities(Read the U-4 form) .



Gene Weissman
Lieber & Weissman Sec., LLC
gweissman@stocktrade.net
 
Quote from Gene Weissman:

SRO's probably do not want traders with financial problems , because of the potential for liability(introducing broker) or fraud by the trader who may be in financial trouble. I assume this is the reason for the SRO's concern. Firms could ask you for a credit or background check in addition to U-4 information. Generallly U-4's ask all questions that relates to a traders financial condition. If you willfully do not report acts of bankruptcy or fraud on a U-4, you could be subject to SRO and/or criminal penalities(Read the U-4 form) .



Gene Weissman
Lieber & Weissman Sec., LLC
gweissman@stocktrade.net [/B]
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Thanks :D

Your input is appreciated.

Being in BK-7 must SUCK!!! :mad:
 
Quote from desperateone:

I don’t know about writing a book but I have no problems sharing a few insights that I’ve learned. I’m sure it’s not anything that hasn’t been already said or written but for what it’s worth, here goes (in no particular order):

- Trading is serious business. If someone is looking for a quick buck then I would advise another route. ...

-Personal growth as a trader. Many traders fall into the trap of only concerning themselves with the bottom line. It’s a Catch 22, the only thing that matters in this industry is whether or not you’re making money. I found that the more I thought about the money the more I would push myself if I was down and at the same time would pull in the reigns when I was up. It doesn’t matter how everyone else is progressing, it only matters if you are progressing. ...

-One day, one week, one month does not make a career. At my firm, there are 3 types of traders: cowboys who lose money, cowboys who make money and the real traders. The cowboys are the ones who almost always have to have positions on and they are always taking a “shot.” They figure that it’s not their money and if it works out, they’ll have a huge day, not concerning themselves with the consequences. They often have huge, inconsistent swings in their accounts. Granted some of these have been able to make good money but they certainly risk a whole bunch. Some people are attracted to this type of trading (read gambling) and it can be exciting but unless you’re seasoned and willing to take big hits then you’re not ready for this. ...

Eventually I found that the real traders (those who take big swings and those who don’t) were more concerned about making a little bit everyday and when the opportunity presented itself, to capitalize on it. There are going to be times when the conditions are not conducive to good trading (not making money) and there are times when it is.

****In other words, these successful traders are willing to wait out the market until they saw their set-up and thus able to build their account one day at a time, one week at a time, one month at a time. ****

-There is more to life than trading. As been discussed several times in many threads, everyone has their own definition of happiness. My definition was that if I were a successful trader then I would be a happy person. I was wrong. I moved to New York for this opportunity and left my family, friends and life back out on the west coast....

****The point being that to succeed in anything in life, you have to be happy as a person. Work is work and you can’t attach any self-worth to it and you can’t take that feeling home as well. As traders, we basically don’t contribute anything to society. I know some traders who volunteer at a soup kitchen every weekend to feel a sense of benefiting others. ****

Sorry for the length but I’ve had some time on my hands as of late. Anyhow I hope it helps others.
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I hope you don't mind the edit to save space but this is one of the BEST posts I've read on ET. This post has been a real eye opener and really says it all. You are so right. I too, am at a junction where I started to have good winning streaks only to give back all my gains after a losing day to try to "get it back" and do a series of bone-headed trades.

Now I'm trying to concentrate on controlling my losses and just stop trading for the day if it's not working. I have to learn to truly accept the fact that sometimes the market just doesn't cooperate. I want to be that "real trader" who focuses on making a little bit each day when the opportunity presents itself - not one of those "cowboys" who tries for the one big trade.

I'm also working on having a more interesting life outside of trading so it doesn't dominate my life. Though that can be tough with a full time job.

I think I will really reach the next level when I can truly accept the possibility that this might not work out and not feel devastated by this thought - but be able to move on.

Hang in there desperateone and keep an open mind regardless of what might happen. I think with your insight you should be able to succeed at trading or anything else you put you mind to do.

I wish you the best of luck. :)
 
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