Problems seldom result in brokers losing their jobs.

Lawyer David Gehn says his client William Abbate is a victim. Listen to how Gehn tells the story, and you decide. Abbate, who currently is a stockbroker at Cantone Research Inc. in Tinton Falls, N.J., has 37 little problems on his record - several states have denied him a license to sell, for instance. But Gehn, ever the optimist, begins an interview with a reporter by declaring that Abbate "has no regulatory problems."

There may be a couple dozen snarls of one sort or another on Abbate's record, concedes Gehn, who has defended Abbate in some of his cases. But "CRD is screwed up" in listing 37 problems, he adds, referring to the Central Registration Depository, a databank of broker records.

The real number of complaints and other items "could be in the 20s" because of double-counting of cases, he says, as if that is somehow reassuring news to the investor who might be considering sending some business Abbate's way. (A check of his records shows only one investor's name listed twice: one complaint in the investor's name and a second in the name of his profit-sharing plan.)

Stockbrokers like Abbate are a regulator's nightmare: They have records bad enough to raise questions, but ambiguous enough to give ample opportunities for them to argue that former employers, greedy customers and incompetent bureaucrats might be the real reason for a record slightly longer than a novella.

State securities regulators are up in arms about brokers like Abbate right now, trumpeting the word that the states' rights to bar problem out-of-state brokers are under threat.

Today, states have the right to review the records of out-of-staters before allowing them to do business. But a proposal by the Securities Industry Association earlier this spring would take states out of the business of screening newcomers in favor of a "national" standard. The problem is, the current national standard tolerates brokers whom some states shoo away - 600 were bounced by Utah alone last year.

Abbate was one of many made to feel unwelcome by Pennsylvania, which started asking questions that ultimately led him to withdraw his application.

Pennsylvania thought Abbate's record was so bad that the state included him among the poster children they used as an example of the state's good work in avoiding rogues. Yet Abbate's record isn't bad enough for him to be ousted from the business. Indeed, when you talk to lawyer Gehn, you get a defense so slick that you wonder if you'd imagined those 37 incidents.

An arrest and incarceration in Georgia related to securities fraud charges was the doing of a "crazy client" who abused his power in the local community, the lawyer adds.

A licensing rejection by Iowa "wasn't a substantive denial." And a second denial by Ohio on the basis that Abbate was "not of good business repute," isn't so worrisome because there were "no substantive findings" used by Ohio for the decision, Gehn says.

A settlement for $4,999 - a buck below what was at the time a threshold for what had to be listed on brokers' records - was a matter of avoiding the onerous costs of litigation, he says.

And eight incidents of investors dropping Abbate's name from an arbitration and naming only his employer - D.H. Blair - came about at the investors' requests, says Gehn.

Although the dropping of a broker's name during settlement talks is a widely used negotiating tactic by defense lawyers (drop the individual's name and we cough up the dough), Gehn insists that's not the case here.

Gehn may have an answer for everything, but some aren't as good as others. Like many defense lawyers, he makes much of the fact that his client's employer, D.H. Blair, was the culprit. "Bill Abbate never pays a dime," Gehn says, referring to the various settlements with Abbate's former customers. Yet the records show that Abbate split a $66,000 settlement with his employer in 1996 and paid for half of a $62,500 arbitration settlement two years before.

Old news, says Gehn, not quite explaining why he so definitively offered the "never pays a dime" defense in the first place.

As attention turns to the ability of federal regulators to rein in brokers with lengthy records, the inevitable question comes up: Considering all the rogues the states are finding, what does it take to kick a broker out of the business?

In some situations, the answer is clear. The National Association of Securities Dealers Regulation Inc., for example, automatically suspends the stockbroker who fails to pay an arbitration award. Brokers are also at high risk should they engage in unauthorized trading or steal money from their customers, says Barry Goldsmith, executive vice president for enforcement at NASDR.

But the process of throwing them out "can take some time," he adds, considering that the broker first goes through NHSDR's disciplinary process, and then has opportunities to appeal to the Securities and Exchange Commission, the U.S. Court of Appeals and the Supreme Court.

NASDR has barred or revoked the licenses of more than 2,000 brokers over the past four years, Goldsmith says. That doesn't include suspensions, which can range from 30 days to two years. Suspensions, in fact, can turn out to be de facto bars because brokers suspended for more than a year typically find new jobs.

"They end up selling cars," Goldsmith says. "Though maybe now they sell BMWs where they used to sell Chevys."

David Levine, special assistant in the enforcement division of the Securities and Exchange Commission, says it generally takes a serious fraud such as theft of client assets to move the SEC to bar a broker. "If it's less egregious, you might get a suspension," he says.

Clear-cut cases of pilfering the dough from a client's account are easy to decide. It's the lengthy rap sheets like Abbate's - with sometimes ambiguous information as to who's at fault - that are tricky for regulators to act on.

Gehn, like other defense lawyers, makes much of the fact that his client worked at a firm that was cited by securities regulators for abusive sales techniques to unload risky penny stocks. That and other things make the lengthy record amount to "37 nonsensical instances," he says.

Is he seriously saying his client is a victim? "Absolutely, absolutely," says Gehn.

Gary Moser, compliance director at Cantone Research, doesn't say Abbate is a victim, but does say the broker is in the process of a turnaround. "Bill's been a model citizen since being here," says Moser. "He really has turned the corner."

Or we'd at least better hope so. Because, from the looks of things, brokers like Abbate can still find lots of places to do business in a regulatory system where brokers who stop short of fraud can rack up long records of "problems" - and stay employed.

Jane Bryant Quinn is on vacation. Susan Antilla is a columnist for Bloomberg News.