On March 29, the Securities and Exchange Commission Division of Examinations (EXAMS) issued a risk alert to remind broker-dealers of their obligations related to anti-money laundering (AML) rules and regulations, as well as to provide the staff’s observations of compliance items related to those obligations. The risk alert is designed to assist broker-dealers with reviewing and enhancing their AML programs.
Continue Reading Compliance Issues Related to Suspicious Activity Monitoring and Reporting at Broker-Dealers

On April 6, the Commodity Futures Trading Commission’s (CFTC) Office of Customer Education and Outreach (OCEO) issued a Customer Advisory, reminding investors to understand fully how commodity futures markets, physical markets and securities markets differ before engaging in trading activity based on tips or other information communicated through social media.
Continue Reading CFTC Issues Customer Advisory on Trading Based on Information Communicated Online

On March 14, the Financial Industry Regulatory Authority (FINRA) published Regulatory Notice 21-11 (Notice), which seeks comment on proposed amendments to Rule 4210 (Margin Requirements) that would clarify and incorporate into the rule current interpretations regarding when issued and other extended settlement transactions and provide relief to facilitate the application of the rule to these transactions. Comments must be received by May 14.
Continue Reading FINRA Requests Comment on Proposed Amendments to Margin Rule 4210

On February 10, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 21-03 (the Notice) urging member firms to review their policies and procedures with respect to red flags of potential securities fraud involving low-priced securities.
Continue Reading FINRA Releases Regulatory Notice on Policies and Procedures Relating to Fraud Involving Low-Priced Securities

On November 24, the Securities and Exchange Commission voted to propose amendments (the Proposal) to (1) Rule 701 under the Securities Act of 1933, as amended (Securities Act), which exempts certain compensatory equity offerings by non-reporting issuers from registration under the Securities Act, and (2) Form S-8, which is a registration statement form available for compensatory securities offerings by reporting issuers.
Continue Reading SEC Announces Proposed Amendments to Rule 701 and Form S-8

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