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Tag Archives: broker-dealers

The Results Are In: Investors Favor Additional Regulatory Protection

Posted in Broker-Dealer Regulation, FINRA Enforcement

On November 6, 2014, FINRA released results from a survey of U.S. investors measuring the demand for additional regulatory protections. The survey polled 1,000 adults and revealed that an overwhelming majority felt that it was important to protect investors and police the markets.  Indeed, 74 percent polled would support additional regulatory protections to safeguard against broker-dealer… Read More

Referral Fees and Commission Sharing – When May Broker-Dealers Share Their Fees with Non-Brokers?

Posted in Broker-Dealer Regulation, SEC Enforcement

FINRA recently filed proposed rule changes with the SEC addressing when broker-dealers may pay referral fees or otherwise share compensation with persons who are not registered as broker-dealers.  The proposed rule changes are subject to the SEC’s approval.  If approved, new Rule 2040 and related conforming changes to other FINRA rules will go into effect… Read More

Stay on Municipal Advisor Rules Expires July 1, 2014

Posted in Broker-Dealer Regulation, Investment Adviser Regulation

The temporary stay previously imposed on the SEC’s final municipal advisor rules expires July 1, 2014.  Accordingly, municipal advisors will be required to register with the SEC on Form MA on a phased-in schedule beginning July 1, 2014, and ending October 31, 2014. Registration of “municipal advisors” under Section 15B of the Exchange Act was… Read More

New FINRA Supervision Rules Impact Broker-Dealers’ Insider Trading Procedures and Supervisory Controls

Posted in Broker-Dealer Regulation, Enforcement, FINRA Enforcement, Insider Trading, SEC Enforcement

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 rules. Among other provisions, the new rules require procedures for detecting and reporting insider trading and impose heightened standards on supervisory… Read More

The Volcker Rule Prohibition on Proprietary Trading: Considerations for Broker-Dealer Affiliates of Foreign Banking Organizations

Posted in Broker-Dealer Regulation

The Volcker Rule imposes significant restrictions on “proprietary trading” by banking organizations and their affiliates.   The Rule applies to all banking entities, which are defined to include foreign banking organizations that have U.S. branches or agencies or which own U.S. banks or certain other U.S. subsidiaries (“FBOs”).   Also covered by the Rule are affiliates of… Read More

Broker-Dealer Cybersecurity: Protect Yourself or Pay the Price

Posted in Broker-Dealer Regulation, Cybersecurity/Privacy, Enforcement, FINRA Enforcement

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 the increasing frequency and sophistication of attacks targeting the nation’s largest financial institutions. The securities industry watchdog continues to be concerned with the integrity of firms’… Read More

FINRA Warns Investors to Look Behind Closed-End Fund Distribution Rates

Posted in Enforcement, FINRA Enforcement

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 funds should take warning that FINRA will be looking at their practices in this regard. The Alert entitled “Closed-End Fund Distributions: Where is the… Read More