Co-authored by Michelle McIntosh.

Pursuant to Regulatory Notice 12-36, the Financial Industry Regulatory Authority (FINRA), together with the other interested members of the Intermarket Surveillance Group (ISG interested members), have delayed the effective dates for firms to submit new data elements for Electronic Blue Sheets (EBS). The postponed compliance dates correspond with the extensions granted by the Securities and Exchange Commission for the implementation of the SEC Large Trader Reporting Rule.

Continue Reading FINRA and ISG Postpone Effective Dates for Enhanced Electronic Blue Sheet Submission

Co-authored by Tanja Samardzija

On July 11, the Securities and Exchange Commission held an open meeting and adopted Rule 613, which requires U.S. exchanges and the Financial Industry Regulatory Authority (FINRA) to submit a national market system (NMS) plan for creating, implementing and operating a single, market-wide consolidated audit trail system. The consolidated audit trail system will collect and accurately identify every order, cancellation and trade execution for all exchange-listed equities and options across all U.S. markets. The consolidated audit trail will increase the data available to regulators investigating illegal activities such as insider trading and market manipulation, and it will significantly improve the ability to reconstruct broad-based market events in an accurate and timely manner.

Continue Reading SEC Adopts Rule to Require Consolidated Audit Trail for Markets

Co-authored by Avi Badash.

Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, on June 28, the Securities and Exchange Commission adopted final rules that establish new procedures for the SEC’s review of certain clearing agency actions. Most of the rules become effective 60 days after the date of publication in the Federal Register.

Continue Reading SEC Adopts New Procedures for Review of Certain Clearing Agency Actions

Co-authored by Tanja Samardzija.

In November 2010, the Securities and Exchange Commission approved FINRA’s new suitability rule — FINRA Rule 2111 (the Rule). Previously, FINRA issued Regulatory Notices 11-02 and 11-25 discussing the Rule’s requirements, offering further guidance on the Rule and announcing a new implementation date of July 9, 2012.

Continue Reading FINRA Provides Additional Guidance on New Suitability Rule

Co-authored by Michelle S. McIntosh.

The Financial Industry Regulatory Authority has filed a proposed rule change with the Securities and Exchange Commission to adopt NASD Interpretive Material 2110-3 (the Front Running Policy) as FINRA Rule 5270. In connection therewith, FINRA proposes to amend FINRA Rule 5270 in several ways to “broaden its scope and provide further clarity into activity that FINRA believes is inconsistent with just and equitable principles of trade.”

Continue Reading FINRA Proposes Rule Change Regarding Front Running of Block Transactions

Co-authored by Michelle S. McIntosh.

The Securities and Exchange Commission approved amendments to Financial Industry Regulatory Authority (1) Rule 6700 Series and Trace Reporting and Compliance Engine (TRACE) dissemination protocols and (2) Rule 7730 regarding TRACE fees. The effective date of the amendments is November 5, 2012.

Continue Reading SEC Approves Amendment to TRACE Reporting Requirements

Co-authored by Tanja Samardzija.

On March 9, 2007, the Securities and Exchange Commission proposed amendments to its net capital, customer protection, books and records and notification rules for broker-dealers. The firm previously summarized these proposed amendments in the March 16, 2007 edition of Corporate & Financial Weekly Digest 

Continue Reading SEC Reopens Comment Period for Proposed Amendments to Broker-Dealer Financial Responsibility and Related Rules

Co-authored by Tanja Samardzija.

The NASDAQ Stock Market (NASDAQ) has proposed to adopt an excess order fee commencing on June 1. This fee is intended to reduce the number of non-actionable orders submitted to the NASDAQ market, and thus promote greater order interaction, increase the quality of NASDAQ market data and prevent potentially abusive trading practices.

Continue Reading NASDAQ Proposes to Institute an Excess Order Fee

Co-authored by Tanja Samardzija.

On April 20, the Securities and Exchange Commission issued an order temporarily exempting broker-dealers from the recordkeeping, reporting and monitoring requirements set forth in Rule 13h-1 of the Securities Exchange Act of 1934 (the Large Trader Reporting Rule) that were scheduled to take effect on April 30, 2012. The order also permanently exempts certain transactions from the definition of “transaction” under the Large Trader Reporting Rule, but only for purposes of determining whether a person is a “large trader.”

Continue Reading SEC Issues Exemptions from Large Trader Reporting Rule