March 28, 2017
On March 22, 2017, the Securities and Exchange Commission (“SEC”) adopted an amendment to Rule 15c6-1(a) under the Securities Exchange Act of 1934 (“Exchange Act”), shortening the standard settlement cycle (i.e., the length of time between trade execution and delivery of cash and securities to the seller and buyer) for…
May 27, 2016
FINRA proposed amendments (SR-FINRA-2016-017) to the debt research rule (FINRA Rule 2242 – Debt Research Analysts and Debt Research Reports), which addresses conflicts of interest relating to the publication and distribution of debt research reports. The proposed amendments clarify the application of the rule in four respects: (1) The consent requirement for institutional debt research reports distributed to non-U.S. investors by non-U.S. affiliates of broker-dealers; (2) The consent requirement for institutional debt research reports distributed to specified persons for informational purposes unrelated to investing in debt securities; (3) The scope of the institutional debt research report exemption when distributing third-party debt research reports to eligible institutional investors; and (4) The disclosure requirements for debt research analysts in public appearances.
July 21, 2014
At a recent luncheon with securities industry compliance and legal professionals, the National Associate Director of the SEC’s broker-dealer examination program, Kevin Goodman, reportedly provided a “sneak peek” on areas of focus for the SEC’s upcoming examination priorities for the year 2015.
July 10, 2013
On June 21, 2013 FINRA filed proposed regulations with the SEC to adopt the consolidated FINRA supervision rules. These rules will integrate and harmonize NASD and NYSE rules on supervision. With this proposed rule change, FINRA continues its development of a FINRA consolidated rulebook. These proposed regulations will…
June 26, 2013
On June 11, 2013, FINRA’s Chief Legal Officer, Bob Colby, discussed potential regulatory revisions for limited purpose broker-dealers during an interview series entitled “A Few Minutes with FINRA.” Colby said that an internal review was underway to determine certain categories of broker dealers (i.e. broker-dealers that don’t touch funds or…
June 12, 2013
FINRA Fines Merrill Lynch $1.05 million and orders more than $323,000 in restitution for best execution violations in non-convertible preferred securities transactions
On April 16, 2013, FINRA announced that Merrill Lynch, the brokerage unit of Bank of America, will pay $1.05 million in fines and more than $323,000 in restitution for failure to provide best execution for trades involving non-convertible preferred securities executed on ML BondMarket, one of its proprietary order management systems, and for failure to have an adequate supervisory system and written supervisory procedures in place. Merrill’s Letter of Acceptance, Waiver and Consent, agreed to by FINRA on April 2, 2013, also includes other sanctions due to the violations occurring over nearly five years.
February 27, 2013
On January 11, 2013, FINRA released its 2013 examination priorities letter. The letter identifies four primary categories as the focus of FINRA’s upcoming examinations and enforcement efforts – Business Conduct and Sales Practice Priorities, Insider Trading, Financial and Operational Priorities, and Market Regulation Priorities. Within…
February 22, 2013
On February 21, 2013 the SEC released its 2013 examination priorities. The SEC states that with respect to broker-dealers it is going to continue to focus on sales practice/fraud, trading, capital, and AML. New issues of concern for the examination process are: the market access rule,…
January 28, 2013
On January 11, 2013, FINRA released its 2013 examination priorities letter. Not surprisingly, FINRA will continue to prioritize core regulatory areas such as AML compliance and insider trading. FINRA will also continue to focus on suitability and complex products, highlighting in the letter FINRA’s recently revised suitability rule, and adding business development companies (“BDCs”) and closed-end funds to its list of complex products. FINRA warns that BDCs expose investors to significant market, credit and liquidity risks and the newer “non-traded BDC funds” can limit investors’ exit opportunities to “periodic share repurchases by the BDC at high discounts.” FINRA also warns that some closed-end funds are returning capital to maintain high distribution rates, causing the fund to trade at high premiums compared to the fund’s NAV.