FINRA Office of General Counsel—Seeking Interpretive Guidance

A critical function performed by FINRA Office of General Counsel (OGC) staff is to provide broker-dealers, attorneys, registered representatives, investors, and other interested parties with interpretive guidance relating to FINRA's rules.1 OGC staff provides such guidance both orally and in writing.  To ensure that requesters receive the most meaningful, effective, and responsive assistance possible, OGC is publishing these guidelines to assist requesters in seeking interpretive guidance from our office.

 

As an initial matter, persons seeking information on a particular subject area may wish to consider reviewing reference materials and existing interpretive guidance already available on FINRA’s Web site, including:

 

  1. Regulatory Notices
  2. Interpretive Letters (these letters address interpretive questions regarding FINRA's rules)
  3. Exemptive Letters (these letters respond to requests for exemptions from specified rules of FINRA)
  4. Disciplinary Actions and the Disciplinary Update (a quarterly online publication that includes a summary sampling of recent disciplinary actions involving misconduct by registered representatives)
  5. FINRA rule filings and Securities and Exchange Commission (SEC) approval orders (FINRA rule filings and approval orders issued by the SEC often contain explanatory information concerning the meaning and intent of the subject rule)

 

Oral Interpretive Requests

If, after consulting these sources, a requester determines that an interpretive issue exists with respect to FINRA's rules, the requester should consider contacting OGC staff by telephone to discuss the issue in more detail. OGC staff often can resolve many inquiries over the telephone. OGC staff generally expects requesters to disclose their identities, and, depending on the nature of the advice sought, the staff may request the identities of any clients on whose behalf they are seeking guidance. It also is important to note that, because of the informal and undocumented nature of phone inquiries, oral responses cannot be relied upon by the member or its counsel as formal positions of the staff.

 

Written Interpretive Requests

Interpretive issues that are too complex for an oral response should be raised through a written interpretive request. When submitting a written interpretive request, requesters should identify the parties involved and fully describe the facts relating to the interpretive question, the interpretive issue raised under those facts, and the specific rule(s) of FINRA to which the inquiry relates. The written request also should reflect any prior communications with FINRA staff relating to the request.

 

Upon receipt of a written interpretive request, OGC staff will send an acknowledgement letter to the requester identifying the attorney to whom the request has been assigned. The acknowledgement letter also will advise the requester that, if a written response to the interpretive request is provided, it may be published on the FINRA Web site.

 

Receipt of an acknowledgement letter does not necessarily mean that a written response will be provided. Depending on the specific question or issue, OGC staff may elect to provide an oral or written response, or may conclude that no response in any form is appropriate.

 

While reviewing a request for written interpretive guidance, OGC staff may need additional information from the requester. To ensure timely responses, OGC staff typically requests that such additional information be provided promptly. Generally, if additional information is not received within two to three weeks of the request, the staff may notify the requester that it deems the request to be withdrawn and that the requester will need to submit a new request containing the additional information if he or she continues to seek a written response. Similarly, any significant changes in the facts underlying a request may result in OGC staff requesting that a new written request letter be submitted containing the pertinent facts.

 

When OGC Cannot Provide Interpretive Guidance

OGC staff can only provide guidance on matters that raise questions of interpretation under FINRA's rules.  Further, OGC staff does not provide responses to interpretive requests that:

 

  • Relate to a FINRA examination or disciplinary action, or involve disputes in litigation or arbitration;
  • Are in anticipation of a FINRA examination or disciplinary action or of potential disputes in litigation or arbitration;
  • Do not identify the inquirer, and, if requested, the client;
  • Do not provide complete facts;
  • Concern vaguely defined transactions or activities;
  • Do not ask about specific rules of FINRA;
  • Request assurances that FINRA will not take enforcement action under specified circumstances; or
  • Seek interpretive advice on specific activities or conduct that has already occurred.

 

Requesters may need to consult their own legal counsel depending on the nature of their request, as well as the facts and circumstances surrounding the request.

 

Other Important Information About Interpretive Guidance

OGC staff believes the interpretive guidance process can provide requesters with important and useful information and guidance relating to FINRA's rules and policies. However, it is important to note that staff-issued interpretive letters express staff views and opinions only and have not been reviewed or endorsed by the FINRA Board of Governors. Staff responses only address the issues raised based on the facts described in a request and do not necessarily address any other rule or interpretation of FINRA or all the possible regulatory and legal issues involved. Written interpretive responses are provided only for the purpose of providing guidance on the staff's views as to the application of particular rules of FINRA under specified circumstances. Members, associated persons, and their counsel should consider the need for further guidance as to the application of FINRA's rules to their own unique circumstances or in the event of subsequent rulemaking or amendments.

 

How to Contact OGC

The OGC is located at:

 

1735 K Street, NW
Washington, DC 20006

 

Telephone: (202) 728-8071
Facsimile: (202) 728-8264

 



1 The current FINRA rulebook consists of: (1) FINRA Rules; (2) NASD Rules; and (3) Incorporated NYSE Rules.