FINRA has requested information from some broker/dealers about investment advisory businesses associated with their organizations, a Finra spokesperson told Dow Jones Newswires Thursday. Firms who received the request had until end of business yesterday to reply.

Some broker/dealers received a five-question request from FINRA, inquiring whether the firm has an investment advisory business within the registered broker/dealer; whether it has an affiliate that has an investment advisory business; and whether the firm has a hedge fund business within the registered broker/dealer. In addition, FINRA requested details about their investment advisory and hedge fund businesses.

According to Dow Jones, FINRA is verifying the level and scope of investment advisor and hedge fund business being done in conjunction with broker/dealers. The verification is only for select firms. A FINRA spokesman told Dow Jones Newswire the action comes “in light of recent developments” – most likely a reaction to the Madoff scandal, says Brian Rubin, a securities attorney for Sutherland in Washington, D.C.

“If we determine that there are issues in a broker/dealer which we regulate that need follow up activity, FINRA will intiate [an] appropriate regulatory response,” spokesman Herb Perone told Dow Jones Newswires. “If we see any issues outside our reach, we’ll communicate that within the SEC – because we only regulate the broker/dealer.”