On February 12, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 21-04 (Notice), in connection with an amendment to FINRA’s Codes of Arbitration Procedure for Customer and Industry Disputes, regarding certain fees paid to arbitration chairpersons. FINRA Rules 12214 and 13214 were amended to increase the hearing-day chairperson fee from $125 to $250 to better compensate the chairperson for the additional training and responsibilities required of the position. Additionally, the amendments establish a new chairperson fee for an additional $125 for each prehearing conference that the chairperson leads, even if an arbitration case closes without a hearing.
Continue Reading FINRA Amends Arbitration Codes to Increase Arbitrator Chairperson Fees and Certain Arbitration Fees

The Financial Industry Regulatory Authority (FINRA) issued an FAQ on whether FINRA Rule 3220 (Influencing or Rewarding Employees of Others) and the non-cash compensation provisions of FINRA Rules 2310, 2320, 2341 and 5110 would prohibit an associated person from hosting a virtual business entertainment event and providing food and beverage to the employees of an

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 March 20, the Fixed Income, Commodities and Currency Markets Standards Board (FMSB) published a draft of its transparency standard on Secondary Market Trading Error Compensation, setting out expected behaviors for the payment of compensation for trading errors.

The transparency standard proposes three methods, subject to these complying with applicable local law, for paying compensation in the event of a trading error (e.g., following a miscommunication between investor and a firm or as a result of timing issues):
Continue Reading FMSB Releases Draft Standard for Compensating Trade Errors

On October 19, proxy advisory firm Institutional Shareholder Services (ISS) announced the results of its Policy Application Survey (PAS). The PAS, which ran from August 3 through October 6, reflects 328 responses: 77 from institutional investors and organizations representing them, and 251 from members of the corporate community, including companies, consultants/advisors to companies, corporate directors and other trade organizations. These surveys often provide a good indication of potential changes to ISS’s voting policies. It is expected that ISS will publish its draft 2018 policy updates and open its comment period in late October, and release its final policy updates in November.
Continue Reading ISS Announces Results of Its 2017 Policy Application Survey

On October 18, the Securities and Exchange Commission’s Division of Corporation Finance (Division) issued five new Compliance and Disclosure Interpretations (C&DIs) with respect to Item 402(u) of Regulation S-K, the rule that requires a registrant to disclose the ratio of its principal executive officer’s total annual compensation to the total annual compensation of their median employee (the “Pay Ratio Disclosure Rule”).
Continue Reading SEC Division of Corporation Finance Issues Five Additional C&DIs Relating to Pay Ratio Disclosure Rule