What Does It Mean to Be ‘Willful’? Defending Against Willful Violations of Securities Laws

Everyone can conjure up an image of a willful child—a kid who has made up his mind to disobey you. But the everyday understanding of “willful” is not what willful sometimes means in the law. Sometimes it can mean a deliberate and intentional violation of an authority, just like a willful child. However, at other times—and this is crucial—willful means simply that the actor was aware of what he was doing; no intent to violate the law is needed. Many market professionals are shocked to learn of the potential consequences of this kind of willful violation. Particularly in securities regulation, a willful violation can lead to a statutory bar from the securities industry by the Securities and Exchange Commission (SEC) or the Financial Industry Regulatory Authority (FINRA). And this is a trap for the unwary.