FINRA Plans New Rules for Bad Brokers
How to deal with firms and brokers with a lot of black marks on their records has occupied a lot of FINRA board and policy discussions.
The Financial Industry Regulatory Authority plans to request feedback via a Regulatory Notice soon on new rules related to broker-dealers with a disproportionately high number of regulatory disclosure events by the firm and/or its registered reps.
Susan Wolburgh Jenah, a member of FINRA’s regulatory policy committee, said in a video taken at the March 13 FINRA board meeting that the committee and FINRA’s board have been discussing over the last few quarters “the issue of how to deal with those firms that have a disproportionately higher number of risk events and disciplinary events on their record.”
FINRA’s board also approved filing with the Securities and Exchange Commission proposed amendments to the Trade Reporting and Compliance Engine (TRACE) rules “to enhance collection and dissemination of new issue reference data for corporate bonds and charge associated fees.”
The TRACE proposal, Jenah said, would “expand the mandate of TRACE to essentially, for FINRA, to become the centralized consolidated source for new reference data on corporate bonds.”