Guidance

Overview

When considering their obligations to provide all available breakpoint discounts on sales of Class A shares of front-end load mutual funds, member firms may review the following Breakpoint Checklist and Breakpoint Worksheet, which may help member firms evaluate their breakpoint compliance programs and confirm whether they are capturing all relevant categories of information to provide customers all available breakpoint discounts.

Background

Another issue we are studying through the lens of FINRA360 is branch office inspections. The responsibility of firms to supervise their associated persons is a critical component of federal broker-dealer regulation. Over the last few years, and in comments we have recently received, firms have raised questions about the manner in which they must conduct internal inspections, particularly for those offices or locations with a limited number of associated persons or where only operational or limited supervisory functions take place.

In Regulatory Notice 23-17, FINRA announced its decision, effective November 30, 2023, to discontinue collecting INSITE data, pursuant to Rule 4540, at this time.  As a result, effective November 30, 2023, the Customer Debits Report was retired from the FINRA Report Center.

To assist firms in complying with SEC Rules regarding financial and operational matters, FINRA has published and will periodically update certain interpretations provided by the staff of the SEC's Division of Trading and Markets.

The TRACE Quality of Markets Report Card for Securitized Products is a monthly status report for the reporting of transactions in Asset Backed Securities, Mortgage Backed Securities and other similar securities, collectively defined as "Securitized Products", to the Trade Reporting and Compliance Engine (TRACE). Firms are required to report trades in accordance with established FINRA rules and regulations.

In general, a member firm’s office or location is either registered as a branch office, if it meets the definitions contained in Rule 3110(f), or exempt from branch office registration (i.e., an unregistered office or non-branch location), if it fits within an express exclusion from the branch office definition listed in Rule 3110(f)(2)(A)(i)–(vii) or is designated as a residential supervisory location (or RSL) under the terms of Rule 3110.19. 

FINRA has enhanced its engagement with key stakeholders to provide greater transparency and foster dialogue that helps us better understand the industry and markets we regulate.

A motion to dismiss is a request made by a party to the arbitrator(s) to remove some or all claims raised by another party filing a claim. Rule 12504 of the Code of Arbitration Procedure for Customer Disputes and Rule 13504 of the Code of Arbitration Procedure for Industry Disputes (collectively, the Codes) establish procedures that govern motions to dismiss.

The Cross-Market Equities Supervision Manipulation Report is a tool designed to provide firms feedback on exceptions that were generated based on the firm’s order entry and trading activity in a given surveillance period. The report covers two distinct analyses; layering and Cross-Market Quote Spoofing. This report is produced on a monthly basis.

This report provides a summary of the review activity for the filings submitted during the selected and previous reporting periods.

If you have questions regarding the content of this report, please contact FINRA Corporate Financing at (240) 386-4623.

Deals Filed During the Selected Period

This targeted educational series is designed specifically for Financial and Operations Principals (FINOPs) and compliance professionals. Each session delivers timely, practical guidance on regulatory updates and operational requirements that directly impact your firm's financial and operational compliance.

These events are open to FINRA member firms only. Participants must provide their firm's broker-dealer number when registering.

Background

In March 2017, FINRA issued a Special Notice on its engagement programs as part of FINRA360. Based on comments and suggestions regarding the usefulness of some advisory committees, their membership and their effectiveness as a vehicle for dialogue between FINRA and member firms, FINRA is making several changes.

Operational Impact of Rule Changes

1. How do I entitle someone to access an eFOCUS report?
2. Where are eFOCUS filings located in the redesigned FINRA Gateway?
3. How do I transmit an eFOCUS filing to my clearing firm?
4. When are my eFOCUS filings due?
5. Where can I see previously filed eFOCUS reports?
6. How do I amend a submitted eFOCUS report?
7. How do I print an eFOCUS report?

The 4530 Disclosure Timeliness Report Card is produced on a monthly basis to show a firm's performance in timely reporting of disclosure events as required by FINRA Rule 4530(a) and (b). The information in this report comes primarily from the Rule 4530 Application; to read more about the system, please see Disclosure Events and Customer Complaint Filings.