On July 2, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 20-22 (the Notice) announcing updates to its interpretations regarding (1) FINRA Rule 4210(e)(8), which specifies margin requirements for control and restricted securities, and (2) FINRA Rule 4210(f)(5), which specifies conditions for the consolidation of two or more accounts carried for the same customer.
Continue Reading FINRA Announces Updates to Interpretations of Margin Rule Regarding Control and Restricted Securities and Consolidation of Accounts

On July 1, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 20-21 (the Notice) providing guidance on compliance with FINRA Rule 2210 Communications with the Public when creating, reviewing, approving, distributing or using retail communications concerning private placement offerings.
Continue Reading FINRA Provides Guidance on Retail Communications Concerning Private Placements

On June 29, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 20-20, updating members on regulatory coordination efforts concerning compliance with Consolidated Audit Trail (CAT) reporting rules.
Continue Reading FINRA Updates Members on Regulatory Coordination Concerning CAT Reporting Compliance

On July 6, the Securities and Exchange Commission announced that it had approved rule amendments to establish an expedited review procedure for exemptive and other applications under the Investment Company Act of 1940 that are substantially identical to recent precedent, as well as a new informal internal procedure for applications that would not qualify for the new expedited process.
Continue Reading SEC Adopts Amendments to Exemptive Applications Procedures

On June 22, Securities and Exchange Commission Chairman Jay Clayton and Brett Redfearn, the Director of the SEC’s Division of Trading and Markets, spoke together on an SEC-sponsored virtual forum about modernizing the US Equity Market Structure. Chairman Clayton identified the market for thinly traded securities, retail fraud and National Market System (NMS) market data and access as three current targets for SEC initiatives.
Continue Reading SEC Chairman Speaks on Modernizing US Equity Market Structure

On June 19, the Financial Industry Regulatory Authority (FINRA) issued a regulatory notice that it had amended its Capital Acquisition Broker (CAB) suitability rule and rules governing non-cash compensation to align with the Securities and Exchange Commission’s Regulation Best Interest (Reg BI) with respect to the requisite standards of conduct.
Continue Reading SEC Approves Changes to FINRA’s Suitability and Non-Cash Compensation Rules

On June 15, Securities and Exchange Commission Chairman Jay Clayton made a public statement (Statement) covering several topics related to Regulation Best Interest (Reg BI) and Form CRS. Chairman Clayton confirmed that the compliance date for Reg BI and Form CRS will be June 30, 2020 and emphasized the SEC’s focus on issues related to Main Street investors, including the creation of a new investor-focused resource to assist such investors with reviewing the Form CRS and researching firms and financial professionals.
Continue Reading SEC Chairman Clayton Provides Public Statement Regulation Best Interest and Form CRS

On June 17, the New York Stock Exchange (NYSE) filed with the Securities and Exchange Commission a series of proposed rule changes (Rule Changes) that aim to support the partial return of Designated Market Makers (DMMs) to NYSE’s New York trading floor. For a temporary period that begins on June 17, 2020, and ends on the earlier of a full reopening of the New York trading floor facilities to DMMs or after the NYSE closes on June 30, 2020 (Covered Period), the following Rule Changes would apply:
Continue Reading NYSE Proposes Rule Changes Regarding the Partial Re-Opening of the Trading Floor