finra

FINRA

For Release:
Contacts:
Monday, April 27, 2009
Nancy Condon (202) 728-8379
Herb Perone (202) 728-8464

 

 

FINRA to Propose Expanding BrokerCheck to Permanently Disclose Disciplinary Histories of Former Brokers

Final Regulatory Actions by the SEC, Regulatory Organizations and the States to be Included

 

Washington, DC — The Financial Industry Regulatory Authority (FINRA) is proposing a major expansion of its BrokerCheck service — to make records of final regulatory actions against brokers permanently available to the public, regardless of whether they continue to be employed in the securities industry. Under current rules, a broker's record generally becomes unavailable to the public two years after he or she leaves the securities industry and is therefore no longer under FINRA's jurisdiction.

 

BrokerCheck is a free online service through which investors can instantly see the employment, qualifications and disciplinary history of more than 650,000 brokers under FINRA's jurisdiction. FINRA estimates there are more than 15,000 individuals who have left the securities industry after being the subject of a final regulatory action and whose disciplinary history is not currently available on BrokerCheck.

 

"It has never been more critical for investors to research the backgrounds of the people who approach them with investment proposals," said Richard Ketchum, FINRA Chairman and CEO. "Individuals previously barred by FINRA and other securities regulators have surfaced in a number of recent frauds responsible for millions lost by unsuspecting investors. Investors should be able to check if the financial professional they're dealing with has been the subject of a disciplinary action by regulators."

 

In many cases, final regulatory actions — such as bars, suspensions and fines — against a particular individual can be found in various places on the internet, including on FINRA's own Web site, by searching individual monthly disciplinary reports. FINRA's proposal would make that information easily and centrally accessible through BrokerCheck.

 

FINRA filed its rule proposal to expand BrokerCheck with the Securities and Exchange Commission (SEC) late last week. The SEC will publish the proposal in the Federal Register and solicit public comment in the near future.

 

In 2008, individuals used BrokerCheck to conduct 11.6 million reviews of broker or firm records. Investors can access BrokerCheck at www.finra.org/brokercheck or by calling (800) 289-9999.

 

FINRA, the Financial Industry Regulatory Authority, is the largest independent regulator for all securities firms doing business in the United States. FINRA is dedicated to investor protection and market integrity through comprehensive regulation. FINRA touches virtually every aspect of the securities business - from registering and educating all industry participants to examining securities firms; writing and enforcing rules and the federal securities laws; informing and educating the investing public; providing trade reporting and other industry utilities; and administering the largest dispute resolution forum for investors and firms.

 

For more information, please visit our Web site at www.finra.org.