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Report from FINRA’s June Board of Governors Meeting

June 17, 2020
Volume 24

disciplinary actions

Disciplinary Actions


Upcoming Deadlines and Effective Dates
  • FINRA Requests for Comment
  • Board of Governors Election
  • Annual Entitlement User Accounts Certification
  • Temporary Amendments to FINRA Rules

Education and Compliance Programs

Reminder: sharing account credentials is strictly prohibited. As FINRA introduces multi-factor authentication (MFA) to access various FINRA applications, FINRA reminds all administrators and users that sharing account credentials to access FINRA systems is strictly prohibited by the Entitlement Program Terms of Use (Section 2A). An account must be used only by the person for whom it is created. This is an important measure to safeguard the data of customers, system users, registered persons and member firms. For more information, please visit FINRA’s MFA page.

FINRA's new virtual conference panels provide a unique opportunity to hear the most up-to-date compliance information directly from industry and regulatory leaders right from the comfort of your home. Watch the latest panel on Social Distancing and the Impact on Older Investors. Join this session for a discussion of emerging research on these topics and steps you can take to further protect your clients.

FINRA’s Board of Governors met on June 10 and 11, when it approved three rulemaking items, FINRA’s 2019 Annual Financial Report and an enhancement of FINRA Enforcement’s technology platform. Watch the Board Report video to learn more. The Board also issued a statement sharing their commitment to the principle of equal justice under the law and to fight all forms of racism and prejudice.

  Disciplinary Actions

FINRA publishes disciplinary actions to remind registered representatives and firms of specific conduct that violates FINRA rules and may result in disciplinary action. FINRA posted the following disciplinary item on the website this week:

 Upcoming Deadlines and Effective Dates

FINRA Requests for Comment

FINRA’s Capital Acquisition Broker (CAB) rules provide a simplified rulebook for broker-dealers that engage only in limited capital advisory, corporate restructuring and private placement activities. FINRA is requesting comment on proposed amendments to the CAB rules, as described in Regulatory Notice 20-04, to make them more useful to CABs without reducing investor protection. The comment period has been extended to June 30, 2020.

FINRA is requesting comment on a proposal to implement the recommendations of the CE Council regarding enhancements to the continuing education requirements for securities industry professionals. The proposal, described in Regulatory Notice 20-05, would change the: (1) Regulatory Element to provide annual training, make the content more relevant, incorporate diverse instructional formats, publicize the learning topics in advance and enhance the related management systems; (2) Firm Element to expressly recognize other training requirements, improve the guidance and resources available to firms and establish a content catalog; and (3) Continuing Education Program to enable individuals who terminate their registrations the option of maintaining their qualification by completing continuing education. The comment period has been extended to June 30, 2020.

FINRA is inviting member firms that participate, or plan to participate, in the security-based swap (SBS) market to provide views and information with regard to broker-dealer SBS activities, including the application of FINRA rules to those activities. Any other interested party is also invited to submit views and information. For more information, including how to make a submission, please visit the FINRA website. FINRA would appreciate receiving responses by July 31, 2020.

FINRA encourages comments on its recent paper on Artificial Intelligence (AI) in the Securities Industry, including areas where guidance or modifications to FINRA rules may be desired to support adoption of AI applications while maintaining investor protection and market integrity. Comments are requested by August 31, 2020.

Upcoming FINRA Board of Governors Election

The annual meeting of FINRA firms will take place on or about Friday, August 7, 2020, to elect one Large Firm Governor and one Small Firm Governor to the FINRA Board of Governors. Election Notice 5/8/20 announced the FINRA Nominating & Governance Committee nominees to fill these vacancies, and informed individuals not nominated by the Nominating Committee of the procedures for being included as an additional candidate on the ballot for these elections.
Petitions for candidacy are due June 22, 2020.

Annual Entitlement User Accounts Certification

FINRA's Annual User Accounts Certification Process is underway and will conclude July 20, 2020. During this period, Super Account Administrators (SAAs) for organizations with more than one user and/or administrator account must certify that individuals have the appropriate level of access to FINRA systems required to perform their job responsibilities or remove access if no longer required. This year, organizations with only an SAA account and no other users or administrators have the option to certify but are not required. For detailed information, refer to the Annual Entitlement User Accounts Certification Process page.

Temporary Amendments to FINRA Rules

FINRA has filed for immediate effectiveness with the SEC a proposed rule change to extend the effective date of the temporary amendments to some timing, method of service and other procedural requirements in SR-FINRA-2020-015 from June 15, 2020 to July 31, 2020.


 Education and Compliance Programs

In response to COVID-19, FINRA has canceled the 2020 Small Firm Conference, scheduled for November 11–12 in Santa Monica, California. We apologize for any disappointment or inconvenience this decision causes. Registrants will receive a cancellation email and FINRA will issue a full refund for registration fees. FINRA has also canceled all hotel reservations that were made through the conference registration portal. If you have questions, please feel free to contact us at [email protected].

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Regulatory Contacts
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