But they say piecing together securities fraud cases requires wading through massive amounts of trading and bank records. All that takes time, money and manpower. Regulators say they have to determine whether there's a pattern of abuse at a firm or whether a customer complaint is isolated to an individual rogue broker. Rogue brokers at A.S. Goldmen weren't isolated. One fifth of the 300 brokers had state actions against them.
Regulators say firms can fight sanctions in drawn out court battles.
And A.S. Goldmen has aggressively defended itself. When New Jersey regulators tried to stop A.S. Goldmen from conducting an initial public stock offering in 1996, A.S. Goldmen sued the state and won. Attorneys for Goldmen argued that only Congress can regulate interstate commerce. Regulators from around the country closely watched the case and argued in the appeal that a Goldmen victory could undermine states' regulatory powers. Earlier this year a U.S. Appeals court overturned the Goldmen victory and ruled in New Jersey's favor.