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Regulation and Compliance > Federal Regulation > FINRA

SEC Extends Some Form ADV Deadlines; FINRA Cancels Events

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The Securities and Exchange Commission and the Financial Industry Regulatory Authority announced several measures over the past few days in reaction to the coronavirus.

The SEC issued regulatory relief to mutual funds and advisors related to reporting forms. RIAs with filing deadlines before April 30 have an additional 45 days from their deadline to file an amendment to Form ADV or file reports on Form ADV part 1A — which details an advisor’s business, ownership, clients, employees, business practices, affiliations, and any disciplinary events of the advisor or its employees.

The forms are normally due within 90 days after a firm’s fiscal year.

The commission also said it would not seek an enforcement action if a registered fund does not “timely” deliver to investors the current fund prospectus because of circumstances related to coronavirus. Fund boards were also given relief from holding in-person meetings.

SEC Chairman Jay Clayton said the extensions “provide additional time so affected funds and advisers can continue meeting the expectations of their investors and clients.”

The SEC said that it continues to assess impacts relating to the coronavirus on investors and market participants and “will consider additional relief from other regulatory requirements.” The agency encouraged financial professionals affected by the coronavirus to contact the SEC with questions and concerns.

The Chicago Board Options Exchange temporarily closed its options trading floor Monday as a precautionary measure to prevent the potential spread of COVID-19. However, options trading continues on an electronic platform.

SEC enforcement and exam divisions remain fully operational, the agency said, with the monitoring of markets for frauds, illicit schemes and other misconduct relating to COVID-19 in full swing. As circumstances warrant, the securities regulator “will issue trading suspensions and use enforcement tools as appropriate.”

Recent trading suspensions issued in connection with COVID-19-related misconduct include Aethlon Medical Inc. and Eastgate Biotech.

FINRA Updates

FINRA said in a notice on its website that the broker-dealer regulator is canceling or postponing all FINRA events scheduled through April 6, and will assess “the feasibility of safely” holding its annual conference in Washington in May. It has set up a web page for virus-related updates.

FINRA also postponed all in-person arbitration and mediation proceedings set to take place through May 1, 2020. “If you have an in-person hearing or mediation session that is postponed as a result of this decision, you will be contacted by FINRA staff to reschedule or discuss remote scheduling options,” it explained in a statement.

As for other FINRA case deadlines, they remain unchanged and “must be timely met unless the parties jointly agree otherwise.”

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