On February 1, the Financial Industry Regulatory Authority (FINRA) published its 2021 Report on FINRA’s Examination and Risk Monitoring Program (Report). The annual Report summarizes various findings and observations from recent FINRA examinations of its member firms on a range of topics and notes certain areas of the future focus of FINRA examinations in 2021.
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NMS Stock
SEC Proposes to Modernize Infrastructure for NMS Securities Market Data
Posted in Broker-Dealer
On February 14, the Securities and Exchange Commission proposed to modernize the infrastructure for the collection, consolidation and dissemination of market data for exchange-listed national market system (NMS) securities, including by expanding the content of included NMS market data and introducing a decentralized consolidation model with competing data consolidators.
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FINRA Issues Regulatory Notice Reminding Member Firms about CAT Reporting Deadlines
By Susan Light & Stanley V. Polit on
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 exchanges that handle orders or quotes in National Market System (NMS) stocks, over-the-counter equity securities or exchange listed options (each, an Industry Member); and 2) third-party CAT reporting agents that are or will be authorized to submit data to the CAT on behalf of an Industry Member. The CAT rules do not provide for any firms to be excluded or exempted from this reporting requirement.
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SEC Proposes Rules to Enhance Transparency and Oversight of Alternative Trading Systems
Posted in Broker-Dealer
On November 18, the Securities and Exchange Commission proposed a rule to enhance operational transparency and regulatory oversight of alternative trading systems (ATSs) that trade stocks listed on a national securities exchange (NMS stocks), including “dark pools.” If adopted, the rule would require NMS Stock ATSs to publicly disclose, on new Form ATS-N, detailed information about the operations and activities of a broker-dealer operator and its affiliates.
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