Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

Tag Archives: FINRA

SEC Approves Amendments to FINRA’s Codes of Arbitration Procedure for Customer and Industry Disputes

Posted in Broker-Dealer
On May 30, the Securities Exchange Commission approved amendments to the Financial Industry Regulatory Authority’s customer and industry arbitration rules to expand the time period for non-parties to respond to arbitration subpoenas and orders of appearance of witnesses or production of documents.… Continue Reading

FINRA Issues Regulatory Notice Reminding Member Firms about CAT Reporting Deadlines

Posted in Broker-Dealer
On May 21, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 19-19 (Notice), which reminds applicable member firms that they must register with FINRA CAT, LLC (FINRA CAT) on or before June 27 for purposes of reporting to the Consolidated Audit Trail (CAT). This reporting requirement relates to 1) member firms or national securities… Continue Reading

FINRA Proposes Rule to Extend the Implementation of Rule Related to Margin Requirements for Credit Default Swaps

Posted in Broker-Dealer, Derivatives
On May 21, the Financial Industry Regulatory Authority (FINRA) filed with the Securities and Exchange Commission a proposed rule (Rule Change) extending the implementation date for FINRA Rule 4240, which implements an interim pilot program with respect to margin requirements for certain transactions in credit default swaps that are security-based swaps. The implementation date has… Continue Reading

FINRA Launches Initiative to Simplify Firms’ Digital Experience With FINRA, Facilitating More Efficient and Effective Compliance Programs

Posted in Broker-Dealer
On May 14, the Financial Industry Regulatory Authority (FINRA) announced that it is launching an initiative designed to transform the digital platform used by firms to engage with FINRA across a variety of programs. The Digital Experience Transformation (the “Initiative”) is an effort to integrate and simplify the digital interactions between brokerage firms and FINRA.… Continue Reading

FINRA Issues Warning on Imposter Website Threat

Posted in Broker-Dealer
The Financial Industry Regulatory Authority (FINRA) has issued a notice warning member firms that there appears to be an increase in imposter websites designed to mimic firms’ actual websites. FINRA suggests that member firms take proactive steps to monitor for imposter websites, including registering URL name variations and using monitoring services to watch for imposter… Continue Reading

FINRA Publishes Consolidated Criteria to Designate Firms for Mandatory Participation in FINRA’s Business Continuity/Disaster Recovery Testing

Posted in Broker-Dealer
On April 19, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 19-15, addressing the criteria used by FINRA to designate member firms that are required to participate in FINRA’s annual business continuity and disaster recovery (BC/DR) testing. As required by Securities and Exchange Commission Regulation Systems Compliance and Integrity (Regulation SCI), FINRA adopted Rule… Continue Reading

FINRA Forms Office of Financial Innovation

Posted in Broker-Dealer
On April 24, the Financial Industry Regulatory Authority (FINRA) announced the formation of the Office of Financial Innovation, which will serve as a central point of coordination for issues related to significant financial innovations by FINRA member firms, particularly new uses of financial technology. The establishment of the Office of Financial Innovation is designed to… Continue Reading

FINRA Releases Report on 2018 Fine Monies

Posted in Broker-Dealer
On April 25, the Financial Industry Regulatory Authority (FINRA) issued a report relating to its use of fine monies collected in 2018. FINRA issued $61.0 million in fines, and incurred $81.1 million in fine-eligible expenditures (i.e., capital initiatives, strategic expenditures and other activities eligible to be funded by fine monies based on FINRA’s Financial Guiding… Continue Reading

FINRA Requests Comment on Proposed Pilot Program to Study Changes to Corporate Bond Block Trade Dissemination

Posted in Broker-Dealer
On April 12, the Financial Industry Regulatory Authority (FINRA) published a regulatory notice (the “Notice”) requesting comment on a proposed pilot program to study proposed changes regarding corporate bond block trade dissemination based upon recommendations by the Fixed Income Market Structure Advisory Committee (FIMSAC) of the Securities and Exchange Commission. The changes are aimed at… Continue Reading

SEC Approves FINRA Rule Change to Permit the Use of Electronic Signatures for Discretionary Accounts

Posted in Broker-Dealer
The Securities and Exchange Commission has approved a proposed rule change to amend Financial Industry Regulatory Authority (FINRA) Rule 4512 (Customer Account Information) (the “Amended Rule”). For discretionary accounts, member firms are currently required to maintain a record of the dated, manual signature of each named, natural person authorized to exercise discretion in such accounts.… Continue Reading

FINRA Proposes Rule Extending the Market-Wide Circuit Breakers in NMS Stocks Pilot Program

Posted in Broker-Dealer
On April 5, the Financial Industry Regulatory Authority filed with the Securities and Exchange Commission a proposed rule change to extend the pilot program related to FINRA Rule 6121.02 (Market-wide Circuit Breakers in NMS Stocks), which provides a methodology for determining when to halt trading in all national market system stocks due to extraordinary market… Continue Reading

FINRA Proposes Rule to Adopt the Remaining Legacy NASD and Incorporated NYSE Rules as FINRA Rules

Posted in Broker-Dealer
On April 8, the Financial Industry Regulatory Authority filed with the Securities and Exchange Commission a proposed rule change to adopt the remaining National Association of Securities Dealers (NASD) Rules and Incorporated NYSE Rules as FINRA Rules in the Consolidated FINRA Rulebook without any substantive changes. The rule change covers areas such as membership rules,… Continue Reading

FINRA Proposes Rule Extending the Pilot Program Related to Exchange-Listed Securities

Posted in Broker-Dealer
On April 5, the Financial Industry Regulatory Authority filed with the Securities and Exchange Commission a proposed rule change to extend the pilot program related to FINRA Rule 11892 (Clearly Erroneous Transactions in Exchange-Listed Securities). In September 2010, the SEC approved, on a pilot basis, changes to the rule that, among other things: (i) provided… Continue Reading

FINRA Announces Updates of the Interpretations of Financial and Operational Rules

Posted in Broker-Dealer
On April 9, the Financial Industry Regulatory Authority issued Regulatory Notice 19-11 informing member firms that FINRA has updated its Interpretations of Financial and Operational Rules to add a new interpretation related to Rule 15c3-1(c)(2)(viii)(C)/06 of the Securities Exchange Act of 1934 (Open Contractual Commitments). The new interpretation relates to the conditions under which an underwriting… Continue Reading

FINRA Issues Regulatory Notice Regarding Departing Registered Representatives

Posted in Broker-Dealer
On April 5, the Financial Industry Regulatory Authority issued Regulatory Notice 19-10 addressing the responsibilities of member firms when communicating with customers about the departure of registered representatives who have direct contact with customers in the conduct of such member firm’s securities sales. The Notice reinforces two key expectations related to such communications. First, in… Continue Reading

FINRA Proposes Rule Addressing Regulation NMS and Extraordinary Market Volatility

Posted in Broker-Dealer
On April 11, the Financial Industry Regulatory Authority filed with the Securities and Exchange Commission a proposed rule change to adopt FINRA Rules 6190 (Compliance with Regulation NMS Plan to Address Extraordinary Market Volatility) and 6121.01 (Resumption of Trading in Securities Subject to the Regulation NMS Plan to Address Extraordinary Market Volatility), which implement the… Continue Reading

FINRA Proposes Rule Making Substantive, Organizational and Terminology Changes to the Corporate Financing Rule

Posted in Broker-Dealer
On April 11, the Financial Industry Regulatory Authority filed with the Securities and Exchange Commission a proposed rule change to make certain substantive, organizational and terminology changes to FINRA Rule 5110 (Corporate Financing Rule – Underwriting Terms and Arrangements), which requires member firms that participate in a public offering to file documents and information with… Continue Reading

Nasdaq Proposes Rule Change to SEC to Assume Operational Responsibility for Certain Investigation and Enforcement Functions Currently Performed by FINRA

Posted in Broker-Dealer
On April 3, the Securities and Exchange Commission published a notice to solicit comments on Amendment No. 2 to a proposed rule change filed by the Nasdaq Stock Market LLC, pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934. The SEC also approved the proposed rule change, as modified by Amendment No. 2,… Continue Reading

FINRA Issues Guidance on FOCUS Reporting for Operating Leases

Posted in Broker-Dealer
On March 19, the Financial Industry Regulatory Authority, Inc. (FINRA) released Regulatory Notice 19-08 to provide guidance to members for reporting lease assets and liabilities on their FOCUS reports. FINRA’s notice follows an October 2018 No-Action Letter (the No-Action Letter) in which the staff of the Securities and Exchange Commission’s Division of Trading and Markets… Continue Reading

FINRA Reminds Firms of Obligations Under Rule 15c2-11(a)(4)

Posted in Broker-Dealer
On March 20, the Financial Industry Regulatory Authority, Inc. (FINRA) released Regulatory Notice 19-09, which reminds members of their obligations under Securities Exchange Act Rule 15c2-11 and FINRA Rule 6432 (Compliance with the Information Requirements of Rule 15c2-11). Rule 15c2-11 prohibits a broker-dealer from publishing (or submitting for publication) a quotation in an unlisted security… Continue Reading

FINRA Files Proposed Rule Change to CAB Rules Governing Qualification, Registration and Continuing Education of Associated Persons of CABs

Posted in Broker-Dealer
The Financial Industry Regulatory Authority (FINRA) is filing with the Securities and Exchange Commission a proposed rule change to amend the Capital Acquisition Broker (CAB) Rules governing the qualification, registration and continuing education of associated persons of CABs (CAB Rules 119-125). The proposed rule change reflects new consolidated FINRA qualification and registration rules and changes… Continue Reading

FINRA Requests Comment on Its Rule on Business Continuity Plans and Emergency Contact Information

Posted in Broker-Dealer
The Financial Industry Regulatory Authority (FINRA) recently released a regulatory notice requesting comment on the effectiveness and efficiency of Rule 4370 (Business Continuity Plans and Emergency Contact Information). The comment period expires April 26. Rule 4370 requires a member firm to create, maintain, annually review and update upon any material change a written business continuity… Continue Reading

Report from FINRA Board of Governors Meeting: Board Approves Rule Proposals, Engages with Boca Raton-Area Firms

Posted in Broker-Dealer
The Board of Governors of the Financial Industry Regulatory Authority (FINRA) met on February 28 and March 1 in Boca Raton, Florida, where it discussed the organization’s finances, reviewed several significant technology and other capital initiatives, and considered certain rulemaking items.… Continue Reading