FINRA’s newly revised Sanction Guidelines, effective immediately, signal that the upward trend in sanctions against broker-dealers is likely to continue.
The Sanction Guidelines, which establish the range of sanctions...more
Broker-dealers appear to have succeeded, at least for now, in beating back FINRA’s proposal to capture extensive amounts of data through electronic means....more
In This Issue:
- SEC Proposes Rule Requiring Hedging Disclosure
- SEC Reports the Result of its Cybersecurity Sweep of Broker-Dealers and Investment Advisers
- House Passes Bill to Ease Volcker Rule and Other...more
2/27/2015
/ Background Checks ,
Broker-Dealer ,
CFTC ,
Compliance ,
Cybersecurity ,
Data Protection ,
Dodd-Frank ,
Enforcement ,
Enforcement Actions ,
Equity Swaps ,
Financial Industry Regulatory Authority (FINRA) ,
Hedging ,
Investment Adviser ,
Investment Management ,
OCIE ,
Securities and Exchange Commission (SEC)
FINRA recently issued a Report on Cybersecurity Practices (“Report”), growing out of its targeted examination of firms last year. To issue the Report, FINRA gave careful consideration to the needs of many broker-dealers for...more
2/25/2015
/ Broker-Dealer ,
Brokers ,
Corporate Governance ,
Cyber Attacks ,
Cybersecurity ,
Data Breach ,
Data Protection ,
Financial Adviser ,
Financial Industry Regulatory Authority (FINRA) ,
Financial Institutions ,
Risk Assessment
In recent years, questions have been raised in many quarters about how brokers with questionable backgrounds have been able to move among firms and remain in the industry. FINRA has responded by enhancing a broker-dealer’s...more
FINRA opened 2015 with a lengthy and ambitious agenda of regulatory priorities. This year’s Regulatory and Examination Priorities Letter is much longer than those issued the last two years, and repeats many of those years’...more
1/9/2015
/ Alternative Investment Funds ,
Alternative Mutual Funds ,
Broker-Dealer ,
Conflicts of Interest ,
Financial Industry Regulatory Authority (FINRA) ,
Individual Retirement Account (IRA) ,
Interest Rates ,
Private Placements ,
Regulatory Agenda ,
REIT ,
Variable Annuities
FINRA recently sanctioned a broker-dealer (the “Firm”) for failure to deliver prospectuses in connection with its sale of ETFs. FINRA also found that the Firm failed to implement a supervisory system reasonably designed to...more
In recent years, the Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) have heightened their expectations of what constitutes a “comprehensive” branch self-inspection program. Firms...more
In This Issue:
- Key Regulators Speak at Structured Products Conference
- FINRA Shows Its CARDS; It Will Use Big Data to Review Suitability of Complex Products Sales
- FINRA’s Proposed Bond Mark-up...more
12/2/2014
/ Advertising ,
Big Data ,
Broker-Dealer ,
CARDS ,
Disclosure Requirements ,
Exchange-Traded Products ,
Financial Industry Regulatory Authority (FINRA) ,
Regulatory Agenda ,
Regulatory Standards ,
Securities and Exchange Commission (SEC) ,
Structured Financial Products
On November 6, 2014, FINRA released results from a survey of U.S. investors measuring the demand for additional regulatory protections. The survey polled 1,000 adults and revealed that an overwhelming majority felt that it...more
In This Issue:
- Regulation: Long-Awaited Money Market Fund Rules Adopted
- SEC Staff Offers Guidance Regarding Investment Advisers and Proxy Advisory Firms
- SEC Staff Closes Loophole on BDC Asset...more
9/17/2014
/ Banks ,
CFTC ,
Conflicts of Interest ,
CPO ,
Dodd-Frank ,
Enforcement Actions ,
Financial Industry Regulatory Authority (FINRA) ,
Hedge Funds ,
Investment Adviser ,
Liquidity Fees ,
Money Market Funds ,
Municipal Advisers ,
NAV ,
Pay-To-Play ,
Proxy Advisors ,
Redemption Gates ,
Securities and Exchange Commission (SEC) ,
Strategic Enforcement Plan ,
Whistleblowers
In an area of broker-dealer practices with relatively little guidance—the appropriate level of commissions or mark ups on securities trades—FINRA recently brought another in a series of cases that provides insight into the...more
In a case involving unsuitable variable annuity (VA) transactions, FINRA found that having good procedures and discovering improper conduct are not enough. A member firm must also ensure that it has adequate supervisory...more
FINRA announced this week that it is conducting a review of its member firms’ order-routing processes and procedures and the execution quality of customer orders in exchange-listed stocks. We previously reported in this...more
On July 2, 2014, FINRA announced that it barred a former equity trader from the securities industry based on its finding that he violated Japanese insider trading law by trading in the securities of a Japanese company listed...more
In This Issue:
- Regulation
..SEC Begins to Scrutinize Registrants’ Cybersecurity Practices
..SEC Staff Sets Boundaries for Adviser Testimonials in Social Media
..Chair White: SEC to Tackle High-Frequency...more
6/16/2014
/ Broker-Dealer ,
Cybersecurity ,
Dark Pool ,
Financial Industry Regulatory Authority (FINRA) ,
High Frequency Trading ,
Investment Adviser ,
JOBS Act ,
Legislative Agendas ,
Marijuana ,
New Legislation ,
Private Equity Funds ,
SEC Commissioner ,
Securities and Exchange Commission (SEC) ,
SIFIs ,
Transaction Fees
Earlier this year, the SEC found that CapWest Securities, Inc., a defunct broker-dealer, had failed to comply with advertising rules in promoting investments that use Section 1031 of the Internal Revenue Code (“1031...more
Broader Availability of Termination Fees and Rights of First Refusal -
Elimination of Filing for Certain ETFs:
In May 2014, the SEC approved FINRA’s proposed amendments to Rule 5110, commonly called the...more
FINRA is seeking to increase investor awareness of BrokerCheck, its online investor tool for researching the professional backgrounds of firms and brokers. BrokerCheck is accessible to investors and all members of the public...more
Broker-dealers selling interests in IPOs need to have adequate supervisory systems to ensure that registered representatives do not make actual sales before the securities are registered, according to a settlement of a formal...more
In an April 24th ruling that will have widespread impact among financial institutions, the FINRA Board of Governors held that a broker-dealer violated FINRA rules by including a mandatory class action waiver in its customer...more
Apparently attempting to understand how broker-dealers provide best execution in the face of incentives to trade at certain exchanges, the SEC and FINRA are asking broker-dealers for extensive transaction information...more
At this week’s Annual SIFMA Law and Compliance meeting, FINRA CEO Rick Ketchum provided a number of candid and pointed comments in a wide-ranging and no-holds-barred interview conducted by long-time senior compliance official...more
In March 2014, the Financial Industry Regulatory Authority (FINRA) fined a broker-dealer $950,000 for supervisory deficiencies related to its failure to adequately supervise the sale of “alternative investments.” These...more
As baby boomers continue to age, securities regulators focus on protecting the growing population of seniors and retirees. For example, the regulators are seeking to ensure that broker-dealers’ systems and procedures for...more