Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

Category Archives: Broker-Dealer

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FINRA Proposes Amendments to Rule Pertaining to Communications with the Public

Posted in Broker-Dealer
The Financial Industry Regulatory Authority (FINRA) is seeking comment with respect to proposed amendments (the “Proposed Amendments”) to FINRA Rule 2210 (Communications with the Public). The Proposed Amendments would create an exception to FINRA’s general prohibition on projected performance and would be applicable to all FINRA-member firms. The Proposed Amendments would allow firms to present… Continue Reading

SEC Approves Pricing Disclosures for Fixed Income Securities

Posted in Broker-Dealer
The Securities and Exchange Commission has approved amendments to Financial Industry Regulatory Authority (FINRA) Rule 2232 (Customer Confirmations) that require FINRA-member firms to disclose additional information to retail customers with respect to transactions in certain fixed income securities (the “Final Rules”). The Final Rules require the disclosure in customer confirmations of (1) the mark-up or… Continue Reading

FINRA Files Proposed Rules With The SEC To Implement Consolidated Audit Trail Plan

Posted in Broker-Dealer
The Financial Industry Regulatory Authority (FINRA) has filed proposed rules with the Securities and Exchange Commission to adopt FINRA Rule 6800 Series, which is designed to implement the compliance rule regarding the National Market System (NMS) Plan Governing the Consolidated Audit Trail. Pursuant to Regulation NMS, various exchanges have filed with the SEC a plan to… Continue Reading

SEC Simplifies Process for Electronically Filing Broker-Dealer Annual Reports

Posted in Broker-Dealer, Derivatives
The Division of Trading and Markets (Division) of the Securities and Exchange Commission has updated its no-action relief to broker-dealers and over-the-counter (OTC) derivatives dealers from the requirement to file annual and supplemental reports with the SEC in paper form. The Division had previously issued a no-action letter in December 2015 that provided relief to… Continue Reading

FINRA and ISG Update Electronic Blue Sheet Data Elements

Posted in Broker-Dealer
The Financial Industry Regulatory Authority (FINRA) and the US members of the Intermarket Surveillance Group (ISG) have updated various data elements for Electronic Blue Sheet (EBS) to include codes for the MIAX Pearl. The FINRA and ISG also have updated the data elements for EBS to include transaction type identifiers for each of “non-program trading,… Continue Reading

MSRB Revises Customer Complaint and Related Recordkeeping Rules

Posted in Broker-Dealer
The Securities and Exchange Commission has approved the Municipal Securities Rulemaking Board’s (MSRB’s) revisions to its customer complaint and related recordkeeping rules. The MSRB has modernized the rules and extended their application to municipal advisors as follows: The MSRB extended its customer complaint recordkeeping requirements to all municipal advisors, including non-solicitor and solicitor municipal advisors.… Continue Reading

FINRA Issues Report on Implications of Blockchain

Posted in Broker-Dealer
On January 18, the Financial Industry Regulatory Authority, responding to increased industry interest in distributed ledger technology (DLT) known as “Blockchain,” issued a report on the uses and potential implications of this technology in the securities industry. The report provides an overview of DLT and its applications in various markets as well as discussing governance,… Continue Reading

FINRA Publishes 2017 Regulatory and Examination Priorities Letter

Posted in Broker-Dealer
On January 4, the Financial Industry Regulatory Authority published its Annual Regulatory and Examinations Letter (Priorities Letter), which outlines the key areas on which FINRA intends to focus during its 2017 exam period. The areas of emphasis set forth in the Priorities Letter are based on observations from FINRA’s regulatory programs and additional input from… Continue Reading

FINRA Interprets “As Soon As Practicable” Requirement Under Trade Reporting Rules

Posted in Broker-Dealer
The Financial Industry Regulatory Authority has issued a notice clarifying the “as soon as practicable” requirement under FINRA reporting rules for transactions effected over-the-counter (OTC). As background, FINRA rules provide that OTC trades in national market system (NMS) securities that are executed during the hours that a FINRA trade reporting facility is open must be… Continue Reading

CBOE Files Proposal To Amend Priority Rules

Posted in Broker-Dealer
On November 22, the Chicago Board Options Exchange, Inc. (the “Exchange” or CBOE) filed a proposal to amend CBOE Rules 6.45A, 6.45B and 6.73, specifying that, for transactions between floor brokers and market makers, the “initiator” of an order is the party responsible for ensuring that transactions are executed in accordance with open outcry priority… Continue Reading

SEC Approves Plan To Create Consolidated Audit Trail

Posted in Broker-Dealer
On November 15, the Securities and Exchange Commission approved the consolidated audit trail (CAT) plan proposed by the self-regulatory organizations (SROs).  As specified by the CAT plan, the CAT will be designed to create a central repository to track all trading activity in national market system (NMS) securities, including options and equity securities.… Continue Reading

SEC Approves Amendments to Rules Governing Communications With the Public

Posted in Broker-Dealer
On October 26, the Financial Industry Regulatory Authority announced that the Securities and Exchange Commission approved amendments to the FINRA rules governing communications with the public. The amendments revise the filing requirements in FINRA Rule 2210 (Communications with the Public) and Rule 2214 (Requirements for the Use of Investment Analysis Tools) and the content and… Continue Reading

SEC Approves FINRA’s Capital Acquisition Broker Rules

Posted in Broker-Dealer, Derivatives
The Securities and Exchange Commission has approved the Financial Industry Regulatory Authority’s new rules governing firms that meet the definition of “capital acquisition broker” (CAB) and elect to be governed by the new CAB rules. (The Corporate & Financial Weekly Digest edition of January 8, 2016 summarized FINRA’s proposed CAB rules.)… Continue Reading

SEC Approves FINRA’s TRACE Amendments for CMO Transactions

Posted in Broker-Dealer
The Securities and Exchange Commission has approved the Financial Industry Regulatory Authority’s amendments to its Trade Reporting and Compliance Engine (TRACE) rules to provide for dissemination of transactions in collateralized mortgage obligations (CMOs), and to reduce the reporting time for CMO transactions. Specifically, FINRA will disseminate trade-by-trade information relative to CMO transactions valued under $1… Continue Reading

SEC Approves FINRA’s TRACE Amendments for US Treasury Securities

Posted in Broker-Dealer
The Securities and Exchange Commission has approved the Financial Industry Regulatory Authority’s amendments to its Trade Reporting and Compliance Engine (TRACE) rules to provide for reporting of transactions in “US Treasury securities,” which includes all securities issued by the US Treasury Department, with the exception of savings bonds. As a consequence, the TRACE reporting requirements… Continue Reading

“Trade Match” and “Trade Acceptance” Clearing Submissions on FINRA’s Alternative Display Facility

Posted in Broker-Dealer
On October 7, the Financial Industry Regulatory Authority issued a Trade Reporting Notice regarding its Alternative Display Facility (ADF). In particular, member firms that use the ADF to report over-the-counter trades in national market system stocks can elect to have their trades submitted by the ADF to the National Securities Clearing Corporation (NSCC) for clearance… Continue Reading

FINRA To Publish Block-Size Trade Data for ATS Trades

Posted in Broker-Dealer
On October 3, the Financial Industry Regulatory Authority began publishing monthly data on block-size trades occurring on alternative trading systems (ATSs). Statistics for ATS block-size trades are being aggregated across all National Market System (NMS) stocks for a one-month trading period and will be published no earlier than one month following the end of the… Continue Reading

SEC Adopts Rules for Enhanced Regulatory Framework for Securities Clearing Agencies

Posted in Broker-Dealer
On September 28, the Securities and Exchange Commission adopted rules enhancing standards for securities clearing agencies deemed systemically important or engaged in certain complex transactions (Covered Clearing Agencies). The SEC also proposed a rule that would subject other types of securities clearing agencies (including SEC-registered central counterparties) to the same standards.… Continue Reading

SEC Chair Gives Speech on Equity Market Structure

Posted in Broker-Dealer
On September 14, Securities and Exchange Commission Chair Mary Jo White gave a speech titled “Equity Market Structure in 2016 and for the Future” at the annual Security Traders Association Market Structure Conference in Washington, DC. Among the highlights from the speech, Chair White stated that: the proposal to amend SEC Rule 15b9-1 to require… Continue Reading

FINRA Proposes Changes to Its Inter-Dealer Quotation System for OTC Equity Securities

Posted in Broker-Dealer
The Financial Industry Regulatory Authority has proposed changes to its inter-dealer quotation system referred to as the “OTC Bulletin Board Service.” Specifically, FINRA is proposing to rename the service as the “Over-the-Counter Display Facility,” or “ODF.” The ODF will be expanded to include any over-the-counter equity security instead of limiting the service to securities from… Continue Reading