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April 2015 Board Update

FINRA Chairman and CEO Rick Ketchum is joined by lead governor Jack Brennan to review rulemaking and other issues discussed at FINRA's April Board of Governors meeting. In addition to the video, a summary of the board actions is also available.

April 16, 2015

Dear Executive Representative:

The FINRA Board of Governors met this week to discuss a number of issues, including several rulemaking items. A summary of the rule proposals, as approved by the Board, is included below.

You can hear more about these rulemaking items and other actions by the Board in our video report.

I welcome your comments.


Richard Ketchum Signature
Richard G. Ketchum
Chairman and CEO

Rulemaking Items Discussed at the April 2015 Board Meeting

Communications With the Public
The Board authorized FINRA to publish a Regulatory Notice requesting comment on proposed amendments to Rules 2210 (Communications with the Public) and 2214 (Requirements for the Use of Investment Analysis Tools) to revise the filing requirements pertaining to retail communications and Rule 2213 (Requirements for the Use of Bond Mutual Fund Volatility Ratings) to refine the scope of the disclosures required. Specifically, the amendments would narrow the new member firm filing window and would simplify filing requirements related to registered investment companies or families of investment companies, investment analysis tools, previously filed templates and bond fund volatility ratings requirements. The proposed changes stem from the retrospective rule review process FINRA initiated in 2014, and are intended to better align the investor protection benefits and the economic impacts.

Mark-Up/Mark-Down Rule Application to US Treasury Securities
The Board authorized FINRA to file with the SEC a proposed amendment to Rule 0150 (Application of Rules to Exempted Securities Except Municipal Securities) to extend the rule governing mark-ups and mark-downs to transactions in U.S. Treasury securities.

Municipal Advisor Exam Fee
The Board authorized FINRA to file with the SEC proposed amendments to Schedule A to the FINRA By-Laws to establish a delivery and administration fee for the Municipal Advisor Representative Examination (the Series 50 examination), which is sponsored by the MSRB. In addition to the test development fee MSRB charges, FINRA will charge an administration and delivery fee of $115 for the Series 50 examination. FINRA will use the fee it charges for the Series 50 examination, in part, to cover the fees that vendors charge FINRA for delivering qualification examinations through their networks of test delivery centers and PROCTOR® system maintenance and enhancement expenses.  

Trading Activity Fee
The Board authorized FINRA to publish a Regulatory Notice requesting comment on proposed amendments to the Trading Activity Fee (TAF) for firms with no customers that are engaged solely in proprietary trading activity for their own accounts. Specifically, the proposed amendments would exclude from the TAF those transactions executed on an exchange of which the firm is a member (including non-market maker trades) provided the firm does not have customers and trades only for its own account.