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July 2016 Board Update

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

July 15, 2016

Dear Executive Representative:

The FINRA Board of Governors met this week to discuss a number of issues, including three rulemaking items. You can hear more about these rulemaking items in our video report and read about them below.

Along with these actions, the Board unanimously elected Jack Brennan as Chairman. Jack had previously served as Lead Governor since 2011 and was formerly CEO of The Vanguard Group. You can read more in our press release.

Jack’s election as Chairman and Robert Cook’s recent appointment as President and CEO complete FINRA’s succession plan for my retirement. It’s been a distinct honor and privilege to lead this organization for the last seven years. I leave with confidence knowing that FINRA is well positioned to continue to effectively deliver on our mission to protect investors, and ensure fair and orderly markets for years to come.


Richard Ketchum Signature
Richard G. Ketchum
Chairman and CEO

Rulemaking Items Discussed at the July 2016 Board Meeting

Alternative Display Facility
The Board authorized FINRA to file with the SEC proposed amendments relating to the use of FINRA’s Alternative Display Facility (ADF) by member firms for trade reporting purposes. The amendments would require firms that use the ADF for trade reporting purposes only to participate in annual connectivity and capacity/stress testing (with exemptions for firms meeting certain thresholds) and pay a monthly connectivity fee.

Desk Research Exemption From Debt and Equity Research Rules
The Board authorized FINRA to publish a Regulatory Notice seeking comment on proposed amendments to FINRA Rules 2241 and 2242 (Equity / Debt Research Analysts and Debt Research Reports) to provide a  safe harbor for desk commentary from specified research rules, subject to several conditions.

Expansion of TRACE to U.S. Treasury Securities
The Board authorized FINRA to file with the SEC proposed amendments to the TRACE rules to require FINRA member firms to report transactions in U.S. Treasury securities to TRACE. Specifically, the amendments would require that firms report transactions in Treasury bonds, notes and bills to TRACE on a same-day basis, but would not apply to purchases in an auction conducted by the U.S. Department of Treasury or to repurchase and reverse repurchase transactions. Under the proposed amendments, reported transaction information would be for audit trail purposes and would not be publicly disseminated.