After announcing that cybersecurity will be one of its 2014 examination priorities, FINRA wasted no time before commencing a sweep. FINRA announced a Targeted Examination Letter to conduct an assessment of firms’ approaches...more
The Financial Industry Regulatory Authority (FINRA) recently took formal disciplinary action against a New York-based broker-dealer that is affiliated with a Mexican broker-dealer and a Mexican bank for inadequate anti-money...more
Financial Industry Regulatory Authority (FINRA) rules require member firms to establish and maintain a system of written procedures to supervise the activities of its members. On December 23, 2013, the SEC approved new FINRA...more
In its recently issued 2014 Regulatory and Examination Priorities Letter, FINRA stated that cybersecurity remains a priority given the ongoing cybersecurity issues reported across the financial services industry, including...more
In This Issue:
“Structured Products, Meet the Volcker Rule”: The New Limitations on Proprietary Trading; SEC and FINRA Personnel Speak at Structured Products Conference; FINRA’s Annual Regulatory and Examination...more
FINRA did not wait for any dust (or snow) to settle on the New Year before alerting the brokerage industry and the public about its regulatory and examination priorities for 2014. This year’s letter, issued earlier than ever...more
1/6/2014
/ Algorithmic Trading ,
Anti-Money Laundering ,
Broker-Dealer ,
Compliance ,
Conflicts of Interest ,
Crowdfunding ,
Employer Liability Issues ,
Enforcement ,
Financial Industry Regulatory Authority (FINRA) ,
High Frequency Trading ,
Qualified Benefit Plans ,
Recidivism
It is the end of the year, and many people are thinking about the status of their retirement accounts and planning any changes to their investments. FINRA also has retirement accounts on the brain. It is thinking about the...more
The SEC is crunching a lot of data these days, and it apparently intends to use some of that data to identify “reverse churning.” Reverse churning is the practice of placing a client who trades infrequently in a fee-based,...more
FINRA continues to discipline broker-dealers that fail to detect and investigate so-called “red flags” of suspicious account activity. Yesterday, FINRA announced a $1 million fine against COR Clearing LLC (the “Firm”) –...more
FINRA recently announced a disciplinary proceeding that underscores its continuing concerns about unsuitable retail sales of structured products. In a recently settled formal disciplinary proceeding, FINRA censured a...more
Abstract:
Purpose –
The purpose of this paper is to interpret Financial Industry Regulatory Authority (FINRA) Regulatory Notice 13-31, which provides practical advice to member firms about how FINRA will be...more
The SEC should put more of its efforts into pursuing regulatory violations, such as failure to supervise, instead of trying to pursue fraud theories on weak facts, according to an SEC Commissioner....more
FINRA issued an Investor Alert concerning closed-end fund distributions, principally to warn the public that a fund’s distributions might include a return of principal. Financial firms that create or distribute closed-end...more
A much-anticipated FINRA report concludes that broker-dealers must do more to manage conflicts of interest.
FINRA said that the report, published on October 14, 2013, highlights “effective conflicts management...more
On the eve of an anticipated increase in private-placement activity as a result of recent reforms made pursuant to the JOBS Act, FINRA issued an Investor Alert on Monday about risks associated with private placements. The...more
The SEC recently finalized amendments to Rule 506 of Regulation D and Rule 144A under the Securities Act relaxing prohibitions against general solicitation in certain private offerings of securities implementing Section...more
As hurricane season approaches, the securities and commodities industries’ principal regulators are effectively encouraging firms to do the equivalent of putting up storm shutters, stocking up on batteries and bottled water,...more
The price tag for failing to detect suspicious activity in penny stocks through an adequate anti-money laundering program continues to increase. Oppenheimer & Co., Inc. recently agreed to pay FINRA more than $1.4 million to...more
FINRA has been engaged in a “stealth sweep” of firms’ untimely deliveries of mutual fund and ETF prospectuses that has resulted in formal disciplinary proceedings against twelve firms since 2011, and a total of over $5...more
FINRA, having enacted new communications rules that specifically reference electronic communications, having issued two Regulatory Notices (linked here and here) providing guidance to the securities industry on social media,...more
A recent FINRA disciplinary action sends a strong message to broker-dealers that the development of their compliance systems — particularly with respect to email review and retention — must keep pace with the growth of their...more
Last week, the Financial Industry Regulatory Authority (FINRA) publicized penalties against three companies – as well as four associated individuals – that it found had failed to establish and implement adequate procedures...more
FINRA recently signaled a continuing focus on the marketing of real estate-related products by issuing a Regulatory Notice expressing concerns about communications involving unlisted, or non-traded, real estate investment...more
FINRA’s concern with the marketing of real estate-related products is reaching fever pitch. Its recent Regulatory Notice draws recent reviews of communications and findings in recent FINRA disciplinary actions, and gives...more
The federal budget sequester and recent Supreme Court decision in Gabelli et al. v. Securities and Exchange Commission, 568 U.S. ____ (2013), will not substantially slow down regulators’ enforcement efforts, according to...more