Guidance

Background

In response to the March 2017 Special Notice on Engagement issued as part of FINRA360, FINRA received a number of comments and suggestions regarding engagement in connection with FINRA's rulemaking process. After carefully reviewing and analyzing the comments, FINRA is taking a number of actions to address the comments and suggestions that it received.

Rulemaking Process

Questions and Answers on FINRA’s Eligibility Proceedings for Firms Participating in the Securities and Exchange Commission’s (“SEC” or “Commission”) Share Class Selection Disclosure Initiative (“SCSD Initiative”).

The Web CRD Form BD Timeliness Report Card is a monthly analysis of FINRA firms' ability to meet certain filing obligations. In accordance with FINRA rules, firms are required to submit information related to applicant member and/or affiliate(s). This report displays a firm's performance in submitting certain BD amendment filings in the required time frame.

FINRA Rule 3170 (Tape Recording of Registered Persons by Certain Firms)—commonly referred to as the “Taping Rule”— requires certain firms to install taping systems to record all telephone conversations between their registered persons and existing and potential customers, review those recordings and file reports with FINRA.

Overview – FINRA’s Funding Portal Rules (FP Rules) apply to firms that register with the U.S. Securities and Exchange Commission (SEC) as funding portals pursuant to the SEC’s Regulation Crowdfunding (Reg CF) and that become FINRA FP members.

Utilize this checklist to determine if a private residence from which an associated person engages in supervisory functions meets the residential supervisory location (RSL) eligibility requirements and conditions. 

FINRA recently introduced a new interactive report card designed to help firms proactively detect potential compliance problems and strengthen their oversight capabilities. The optional report card provides near real-time insights and interactive features to help identify reporting deficiencies and enhance your compliance programs.

To view the report card, you must have the entitlement: Firm View Equity Report Card

Background

A large number of registered representatives are also Certified Financial Planner^TM (CFP^®) professionals. These professionals must complete a minimum of 30 continuing education (CE) hours every two years as part of the requirements for CFP certification renewal. Through the FINRA360 process, a number of firms expressed a desire for improved opportunities with regard to continuing education credits.

1. When are books, records and accounts under the “control” of a member firm, associated person or person subject to FINRA’s jurisdiction?

For purposes of Rule 8210, whether a particular document is within a member firm’s or person’s “control” is determined by the facts and circumstances of each situation. Generally, a document will be considered to be in the control of a member firm or person if the firm or person has the legal right, authority or ability to obtain the document upon demand.¹

The Executing Firm 10 Second Compliance Report Card is a monthly status report for trades that another firm reported on behalf of the market participant. The report contains counts of properly modified late trades, late trades that were not modified, and improperly modified trades.  

• Overview
• How to Request an Addition to the Eligible Multifamily Programs
• Additional Eligible Multifamily Programs

Overview

Rule 4210(e)(2)(H)(ii)a.2. provides that: 

Background

In March 2017, FINRA issued a Special Notice on its engagement programs as part of FINRA360, its comprehensive review of its operations. In response to the Special Notice, FINRA received a number of 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. After carefully reviewing and analyzing the comments, FINRA is taking a number of actions to address the comments and suggestions. 

In June 2009, FINRA issued Regulatory Notice 09-31 to remind firms of their sales practice obligations relating to leveraged and inverse exchange-traded funds (ETFs). At the same time, the Investment Industry Regulatory Organization of Canada (IIROC) issued guidance to the Canadian industry that is substantially similar to our Notice. In July we released a compliance podcast concerning the Notice and some of the issues that it raised.

Background

Small firms represent a critical portion of FINRA’s membership and often face regulatory challenges that are unique from their large firm counterparts. In an effort to provide additional compliance education and consistent with the FINRA360 goal of being a more effective regulator, FINRA launched The Small Firm Report in April 2018. The Small Firm Report is a free conference call series hosted by senior FINRA leaders who discuss trending topics, new rules and regulatory guidance and best practices, as well as answer questions from participants.

The Contra Executing Firm 20 Minute Compliance report card is a monthly status report that provides information on transactions in which a firm failed, as the Contra Firm to accept / decline / compare trades within 20 minutes after execution, in apparent violation of FINRA Rules 7230A(b) and/or 7330(b).

The following FAQ is provided to facilitate firms' compliance with FINRA Rules 5190 (Notification Requirements for Offering Participants), 6275 (Withdrawal of Quotations) and 6435 (Withdrawal of Quotations in an OTC Equity Security in Compliance with SEC Regulation M). A comprehensive overview of these rules and related guidance is set forth in Regulatory Notice 08-74 and Regulatory Notice 12-19.