Regulatory Notice 15-23

FINRA Provides Limited Relief Regarding Requirement to Promptly Transmit Funds in Connection With Sales of Securities on a Subscription-Way Basis for the Purpose of Completing Suitability Reviews Under Identified Conditions

Executive Summary

FINRA is providing limited relief regarding the requirement to promptly transmit customer funds received in connection with sales of securities on a subscription-way basis for the purpose of completing suitability reviews. Pursuant to the limited relief, a firm may hold a customer check payable to an issuer or an appropriate third-party payee acting on behalf of the issuer (e.g., a transfer agent or custodian) (hereinafter collectively referred to as “issuer”) for up to seven business days from the date that an office of supervisory jurisdiction (OSJ) receives a complete and correct application package for the purchase of securities on a subscription-way basis provided that all conditions set forth herein are present.

Questions regarding this Notice should be directed to:

  • Joseph P. Savage, Vice President and Counsel, Regulatory Policy, at (240) 386-4534;
  • James S. Wrona, Vice President and Associate General Counsel, Office of General Counsel (OGC), at (202) 728-8270;
  • Jeanette Wingler, Assistant General Counsel, OGC, at (202) 728-8013; and
  • Susan DeMando Scott, Associate Vice President, Risk Oversight and Operational Regulation, at (240) 386-4620.