The Financial Industry Regulatory Authority is continuing to overhaul the rules that govern members’ communications with the public.
FINRA has published the proposed changes in Regulatory Notice 09-55.
The proposed rules would would replace current NASD Rules 2210 and 2211, the “interpretive materials” that follow NASD Rule 2210, and parts of Incorporated NYSE Rule 472.
FINRA notes that it will release a separate proposal, regarding changes in the public communications rules that govern variable life insurance and variable annuity products, “in the near future.”
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The proposal now on the FINRA website would reduce the number of communication categories for all products to 3, from 6.
The new categories would be “institutional sales material,” “retail communications” and “correspondence.”
The correspondence category “would include any written (including electronic) communication that is distributed or made available to 25 or fewer retail investors, regardless of whether they are existing or prospective customers,” officials say.
The proposal would eliminate the current definitions of “advertisement,” “sales literature,” “institutional sales material,” “public appearance” and “independently prepared reprint.”