Regulatory Notice 08-23

Proposed Consolidated FINRA Rules Governing Financial Responsibility; Comment Period Expired: June 13, 2008

Executive Summary

As part of the process to develop a new consolidated rulebook (the Consolidated FINRA Rulebook),1 FINRA is requesting comment on a proposed set of financial responsibility rules (the proposed rules). Proposed FINRA Rules 4110, 4120, 4130, 4140 and 4521 would be new, consolidated rules based in part on existing NASD and Incorporated NYSE Rules2 and would govern members' financial responsibility requirements. Proposed FINRA Rules 9557 and 9559 would revise NASD Rules 9557 and 9559, respectively, and would afford members served with a notice under the financial responsibility rules an expedited appeal process. (In addition, FINRA would make conforming revisions to Section 4(g) of Schedule A to the FINRA By-Laws.)

The text of the proposed rules is set forth in Attachment A. The chart in Attachment B summarizes the applicability of the proposed rules to member firms.

Questions regarding this Notice should be directed to:


  • Kris Dailey, Vice President, Risk Oversight & Operational Regulation, at (646) 315-8434;
  • Susan M. DeMando, Associate Vice President, Financial Operations Policy, at (202) 728-8411; or
  • Adam H. Arkel, Assistant General Counsel, Office of General Counsel, at (202) 728-6961.


1 The current FINRA rulebook consists of two sets of rules: (1) NASD Rules and (2) rules incorporated from NYSE (Incorporated NYSE Rules). The Incorporated NYSE Rules apply only to those members of FINRA that are also members of the NYSE (Dual Members). Dual Members also must comply with NASD Rules. For more information about the rulebook consolidation process, see FINRA Information Notice, March 12, 2008 (Rulebook Consolidation Process).

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The views, expressions, findings and opinions expressed in the comments on this Web page are solely those of the author(s) and FINRA accepts no responsibility for the content of the comments.

Comments By Date Received
First Asset Financial Inc. (PDF 35 KB) 5/15/2008
Colonnade Securities LLC (PDF 30 KB) 5/28/2008
Thornburg Securities Corp. (PDF 33 KB) 5/29/2008
Karen Fischer (PDF 29 KB) 6/4/2008
George K. Baum & Co. (PDF 91 KB) 6/6/2008
Federated Investors, Inc. (PDF 117 KB) 6/11/2008
TBT Securities, L.C. (PDF 39 KB) 6/12/2008
Alan Levin (PDF 30 KB) 6/12/2008
Stephen Kinkade (PDF 40 KB) 6/13/2008
Stephen Kinkade (PDF 40 KB) 6/13/2008
Stephen Kinkade (PDF 36 KB) 6/13/2008
Capstone Partners LP (PDF 35 KB) 6/13/2008
Financial Services Institute (PDF 74 KB) 6/13/2008
Sutherland (PDF 88 KB) 6/13/2008
ING Advisors Network (PDF 4056 KB) 6/13/2008
SIFMA (PDF 32 KB) 6/13/2008
Northwestern Mutual Investment Services, LLC (PDF 58 KB) 6/13/2008
Wachovia Securities LLC (PDF 67 KB) 6/13/2008
Cantella & Co., Inc. (PDF 83 KB) 6/25/2008