On September 9, the Securities and Exchange Commission voted to propose amendments to the national market system plan (CAT NMS Plan) governing the Consolidated Audit Trail (CAT).
Susan Light
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SEC Releases Small Entity Compliance Guide for Regulation Best Interest and Form CRS
By Susan Light, Michael T. Foley & Adam P. Haft on
Posted in Broker-Dealer
On September 9, the Securities and Exchange Commission (SEC) released two small entity compliance guides to assist broker-dealers and investment advisers in complying with the recently adopted Regulation Best Interest (Reg BI) and Form CRS.
FINRA Issues Call for Candidates in Upcoming Small Firm Advisory Committee Election
By Susan Light, Michael T. Foley & Adam P. Haft on
Posted in Broker-Dealer
On September 4, the Financial Industry Regulatory Authority (FINRA) issued a notice informing small FINRA member firms of the upcoming Small Firm Advisory Committee (SFAC) election. One seat on the SFAC representing the New York region is open for election.
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FINRA Warns Investors of Potential Stock Fraud in Wake of Hurricane Dorian
By Gregory A. Uffner & Susan Light on
Posted in Broker-Dealer
The Financial Industry Regulatory Authority (FINRA) recently released an investor alert cautioning investors of potential stock fraud in the wake of Hurricane Dorian. FINRA noted that financial fraud and potential investment scams regularly follow a natural disaster. …
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FINRA Issues Guidance on Member Firms’ Supervisory Obligations When Participating in Investment-Related Activities With Municipal Clients
By Susan Light, Michael T. Foley & Stanley V. Polit on
Posted in Broker-Dealer
On August 16, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 19-28 (Notice) reminding member firms of their supervisory obligations under FINRA Rules 3110 (Supervision) and 3120 (Supervisory Control System) if they 1) hold or transact in customer accounts owned by municipal entities or obligated persons (i.e., municipal clients), as defined in Section 15B of the Securities Exchange Act of 1934, as amended; and 2) participate in investment-related activities with municipal clients (e.g., recommending or selling non-municipal securities products to such municipal clients).…
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FINRA Issues Regulatory Notice Reminding Members of the SEC’s Adoption of a Best Interest Standard of Conduct
By Susan Light, Michael T. Foley & Adam P. Haft on
Posted in Broker-Dealer
On August 7, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 19-26, reminding members of the Securities and Exchange Commission’s (SEC) adoption of a “best interest” standard of conduct for broker-dealers and a relationship summary (Form CRS) delivery obligation.
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CBOE Proposes Amendments to Rule 6.49A Concerning Off-Floor Position Transfers Including RWA Transfers
By Michael T. Foley, Susan Light & Gregory A. Uffner on
Posted in Broker-Dealer
CBOE Exchange, Inc. (CBOE) recently filed a proposal to amend its Rule 6.49A to amend provisions related to permissible off-floor position transfers. Generally, CBOE Rule 6.49A(a) specifies limited circumstances in which CBOE Trading Permit Holders (TPHs) may transfer their positions off the floor. CBOE proposes to add four events where an off-floor transfer would be permitted to occur. …
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FINRA Announces Final Results of Mutual Fund Waiver Initiative
By Susan Light & Stanley V. Polit on
Posted in Broker-Dealer
On July 17, the Financial Industry Regulatory Authority (FINRA) announced settlement arrangements with 56 member firms that failed to (i) waive mutual fund sales charges for eligible accounts and (ii) reasonably supervise the sale of mutual funds offering sales charge waivers. As part of the settlement, the member firms agreed to pay $89 million in …
FINRA Publishes Guidance on Public Offering Review Process and Private Placement Filings
By Susan Light, Michael T. Foley & Stanley V. Polit on
Posted in Broker-Dealer
On July 16, the Financial Industry Regulatory Authority (FINRA) published separate guidance related to the public offering review process (Public Offering Guidance) and private placement filings (Private Placement Guidance). FINRA rules impose a number of obligations on member firms participating in the distribution of shares in a public offering. The Public Offering Guidance outlines, among other items, the use of FINRA’s Public Offering System, the handling of potential conflicts of interest related to a public offering and the types of public offering reviews available from FINRA’s Corporate Financing Department. Similarly, the Private Placement Guidance summarizes FINRA rules related to private placements, including the corresponding filing requirements, and provides guidance with respect to compliance with the rules. Both sets of guidance also include an outline of FINRA’s review process and provide links to additional resources.
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Division of Trading and Markets and FINRA Staffs Issue Joint Statement on Broker-Dealer Custody of Digital Asset Securities
By Michael T. Foley, Leonard Licht & Susan Light on
On July 8, in response to questions raised by market participants regarding the application of federal securities laws and the Financial Industry Regulatory Authority (FINRA) rules to the custody of digital asset securities and transactions, the staffs of the Division of Trading and Markets (the Division) and FINRA issued a joint statement. The joint statement seeks to articulate and clarify various considerations pertinent to many of the questions raised, particularly with respect to the Securities and Exchange Commission’s Customer Protection Rule applicable to SEC-registered broker-dealers.…
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