Nearly a year ago, FINRA adopted Rule 2165 (Financial Exploitation of Specified Adults) and amended Rule 4512 (Customer Account Information). This new rule and amended rule were ways to address the myriad of issues dealing with senior clients.
With nearly a year gone by, FINRA has now published responses to frequently asked questions involving Rules
The SEC recently put out an Investor Bulletin on wrap fees. Although this guidance is steered toward consumers, there are lessons to be learned by firms who offer such programs.
The SEC specifically posed the question of what does the fee cover. Included in that list of possibilities are:
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FINRA recently issued a report regarding its examination findings. FINRA issued this report so that firms can gain insight from the work of FINRA’s examination of other firms.
Among the FINRA’s findings are the following areas that need additional attention:
In Notice to Members 17-38, FINRA has put out for comment a change to Rule 3110 that would allow the remote inspection of certain “qualifying offices” as that term is defined by FINRA. In its Notice to Members, FINRA highlighted the point that technology and a changing industry mandate reconsideration of requiring mandatory, in-person inspections.
The SEC recently upheld a statutory disqualification that FINRA imposed where the representative filed a false U-4 and falsely answered compliance questionnaires. It appears as though the registered representative failed to disclose tax liens and a bankruptcy on his U-4. So is statutory disqualification the proper punishment for this misdeed.
According to FINRA and
The SEC recently announced an enforcement initiative that will target retail investor harm. The agency’s task force will use data analytics to find widespread problems regarding fee disclosures and unsuitable investment recommendations. In addition to data analytics, the SEC will rely upon tips, complaints and referrals that come into the SEC.
This heightened analysis of
FINRA is considering a number of changes to its arbitration procedure. For a good discussion on the subject, see this article.
Recent exams have shown that cybersecurity weaknesses are a real issue for the industry. This article from the Investment News provides the detail.
For a nice discussion on the SEC’s cyber-security alert, please see this link.
The SEC recently issued an alert for investment advisors regarding cybersecurity. Here is a link to a story on the alert. Are you doing enough to fight this risk? If you do not have an answer, then the answer is probably no.