Request for Comment Regarding Outside Activities Requirements

Request for Comment Regarding Outside Activities Requirements 
On March 14, FINRA published Regulatory Notice 25-05 requesting comments on a proposed new rule to streamline and reduce unnecessary burdens regarding existing requirements for the outside activities of member firms’ associated persons, including registered persons. The proposal would replace two rules—Rule 3270 (Outside Business Activities of Registered Persons) and Rule 3280 (Private Securities Transactions of an Associated Person)—with one rule and is intended to enhance efficiency without compromising protections for investors and members. Comments are open until May 13. 
 

Two SEC Orders on FINRA Proposed Rule Changes 
Last week, the SEC issued two orders instituting proceedings to determine where to approve or disapprove FINRA proposed rule changes. 
 

Comment Period for Metaverse Report Extended 
FINRA is seeking comments to its report, “The Metaverse and the Implications for the Securities Industry,” from firms and other market participants currently exploring metaverse technology. The deadline to submit comments is April 25. 
 

Texas and Washington Join States Accepting RSLs 
As of last week, Texas’ and Washington’s Form BR settings were updated to reflect that they now accept Residential Supervisory Locations. The Jurisdiction Fee and Setting Schedule has been updated accordingly. 
 

Be Aware of Ongoing Phishing Campaign Impersonating FINRA Employees 
A recent Cybersecurity Alert warned member firms of an ongoing phishing campaign involving fraudulent emails targeting executives purporting to be from FINRA employees, with the goal of harvesting credentials. These emails are not from FINRA, and firms should delete them and consider blocking the fraudulent domains. These phishing campaigns can be reported to FINRA by contacting the firm’s Risk Monitoring Analyst or by filing a regulatory tip. 
 

ICYMI: Rule Modernization Regulatory Notice 
FINRA published Regulatory Notice 25-04 last week, the first step in a broad review of its regulatory requirements applicable to member firms and associated persons. To begin this review, FINRA has identified capital formation and the modern workplace as two initial areas of focus where it expects to issue targeted requests for comment in the near future. Member firms and other stakeholders can submit comments until May 12. 
 

ICYMI: Watch Out for Malware Targeting Firm Customer Support Personnel 
Firms could be vulnerable to a newly discovered social engineering scheme, Zhong Stealer, in which bad actors trick customer support personnel into downloading and executing malware. In a recent Cybersecurity Alert, FINRA shared actions that firms can take to protect against this type of scheme. 
 

ICYMI: Mail Scam Targeting Executives Claims Ties to Ransomware 
On March 6, the FBI issued an alert advising of an ongoing scam involving letters delivered in the mail from unidentified criminal actors to corporate executives, claiming to have come from a ransomware group, with the intent to scam organizations into paying a ransom. In a recent Cybersecurity Advisory, FINRA recommended actions that firms can take to protect against this scheme.

Comment on Metaverse Report: As detailed in the feature above, FINRA is seeking comments to its report, “The Metaverse and the Implications for the Securities Industry,” from firms and other market participants until April 25. 
 

Comment Regarding Outside Activities Requirements: Read the feature above for more information on FINRA’s recently published Regulatory Notice 25-05, which would replace two rules—Rule 3270 (Outside Business Activities of Registered Persons) and Rule 3280 (Private Securities Transactions of an Associated Person)—with one rule and is intended to enhance efficiency without compromising protections for investors and members. Comments are open until May 13. 
 

SEC Request for Comment: As noted in the feature above, the SEC issued an order on March 10 instituting proceedings to determine whether to approve or disapprove FINRA’s proposed rule change to amend the Codes of Arbitration Procedure to make changes to certain provisions relating to the arbitrator selection process. Comments are due by April 4 and rebuttal comments are due by April 18. 
 

SEC Request for Comment: As noted in the feature above, the SEC issued an order on March 12 instituting proceedings to determine whether to approve or disapprove FINRA’s proposed rule change to amend the Codes of Arbitration Procedure to add new rules to accelerate the processing of arbitration proceedings for parties who qualify based on their age or health condition. Comments are due by April 8 and rebuttal comments are due by April 22.