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FINRA Looks to Hold More Exams, Arb Hearings Virtually

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What You Need to Know

  • The right place is probably in the middle, where FINRA takes a more risk-based approach to on-site exams, Cook said.
  • FINRA has done about 85,000 online exams.
  • All of FINRA's 69 arbitration locations are now open, but there’s still demand to do hearings by Zoom.

The Financial Industry Regulatory Authority is reassessing its exam and arbitration forum formats, according to CEO Robert Cook.

“We’ve retained the flexibility to do on-site [exams] when we need to,” Cook said Tuesday at the Georgetown Financial Markets Quality Conference. “But going forward, we’re probably going to revisit how we do this. … The right place is probably in the middle, where we take a more risk-based approach — deciding where we go on-site.”

As for FINRA’s testing centers, the broker-dealer self-regulator has set up an online testing capability, Cook relayed, and has “done about 85,000 online exams; now the testing centers are open.”

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In the future, FINRA will, “in appropriate circumstances,” allow exams to be taken online, Cook said.

As of Aug. 2, all of FINRA Dispute Resolution hearing locations — 69 — opened for in-person proceedings. FINRA decided in early June to open all locations. Before that, 62 of 69 were open.

While all of FINRA’s arbitration locations are now open, Cook said, “there’s still demand to do hearings by Zoom.” FINRA’s arbitration task force is going “to help us figure out how to have a hybrid [arbitration] environment going forward.”