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Guidance
- Regulatory Notices
- UPC Advisories
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Upcoming Deadlines and Effective Dates
- FINRA Requests for Comment
- SEC Request for Comment
- FINRA Elections
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Education and Compliance Programs |
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"Addressing and Reporting Financial Exploitation of Senior and Vulnerable Adult Investors" is a free training that FINRA, the SEC and NASAA announced last week in recognition of World Elder Abuse Awareness Day. Firms can use the training to educate employees and other affiliated persons on how to detect, prevent, and report financial exploitation of senior and vulnerable adult investors. The training is also a resource for firms implementing the requirements of the Senior Safe Act and certain state training requirements relating to senior investment protection.
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FINRA has released the FINRA Diversity & Inclusion Report — 2020 Year in Review. This report describes FINRA's diversity and inclusion programs and the progress we have made in 2020.
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Guidance
FINRA Eliminates the Order Audit Trail System (OATS) Rules
Effective September 1, 2021, FINRA is amending its rulebook to eliminate the Order Audit Trail System (OATS) rules in the FINRA Rule 7400 Series and FINRA Rule 4554 (Alternative Trading Systems — Recording and Reporting Requirements of Order and Execution Information for NMS Stocks). As outlined in Regulatory Notice 21-21, FINRA has determined that the accuracy and reliability of the Consolidated Audit Trail (CAT) meet the standards approved by the SEC and has determined to retire OATS as of September 1, 2021.
FINRA Alerts Firms to Phishing Email From “FINRA Support” From the Domain Name "westour.org"
FINRA warns member firms of an ongoing phishing campaign that involves fraudulent emails purporting to be from “FINRA SUPPORT” with the email address “[email protected]”. The email asks the recipient pay attention “to the report attached below that requires your immediate response” and states that “[t]he attachment contains our updated Public Policy information.” FINRA recommends that anyone who clicked on any link or image in the email immediately notify the appropriate individuals in their firm of the incident. See Regulatory Notice 21-22 for a sample fraudulent email.
FINRA Reminds Member Firms of Requirements Concerning Best Execution and Payment for Order Flow
FINRA has issued Regulatory Notice 21-23 to remind member firms of longstanding Securities and Exchange Commission (SEC) and FINRA rules and guidance concerning best execution and payment for order flow, which the SEC has defined very broadly to refer to a wide range of practices including monetary payments and discounts, rebates, or other fee reductions or credits. Under these rules and guidance, member firms may not let payment for order flow interfere with their duty of best execution.
UPC Advisories
The following UPC Advisories were published in the last week:
- UPC #30-21: SHL Liquidation Industries Inc (f/k/a Shiloh Industries, Inc) (SHLOQ)
- UPC #31-21: Yogaworks Inc (YOGAQ)
- UPC #32-21: Algonquin Power & Utilities Corp Corporate Units (When Issued) (OTC Symbol: AQNNV)
- UPC #33-21: Algonquin Power & Utilities Corp Corporate Units (When Issued)
- UPC #34-21: Gladstone Commercial Corporation Preferred Stock Series G (When Issued) (OTC Symbol: GSCCV)
- UPC #35-21: Gladstone Commercial Corporation (GSCCP)
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Upcoming Deadlines and Effective Dates
FINRA Requests for Comment
FINRA seeks comment on any aspects of our rules, operations and administrative processes that may create unintended barriers to greater diversity and inclusion in the broker-dealer industry or that might have unintended disparate impacts on those within the industry. See Regulatory Notice 21-17 for additional information. The comment period expires June 28, 2021.
FINRA is requesting comment on potential enhancements to its short sale reporting program in Regulatory Notice 21-19. FINRA is considering: (1) modifications to its short interest reporting requirements (Rule 4560); (2) a new rule to require that participants of a registered clearing agency report to FINRA information on allocations to correspondent firms of fail-to-deliver positions; and (3) other potential enhancements related to short sale activity. The comment period expires August 4, 2021.
SEC Request for Comment
The SEC requests comment on FINRA’s proposal relating to members’ filing requirements under FINRA Rule 6432 (Compliance with the Information Requirements of SEA Rule 15c2-11). Comments are due July 6, 2021. See the Federal Register notice.
FINRA Elections
The annual meeting of FINRA firms will take place on or about Wednesday, September 1, 2021, to elect one Large Firm Governor, one Mid-Size Firm Governor, and one Small Firm Governor to the FINRA Board of Governors. Election Notice 6/4/21 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 July 19, 2021.
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Education and Compliance Programs
Register for the virtual Diversified and Carrying & Clearing Member Forum on July 13. Firm Grouping Member Forums are free one-day events designed to provide financial professionals associated with FINRA member firms the opportunity to engage in key discussions with FINRA staff and connect with industry leaders and peers. The forums also include thoughtful discussions around the future landscape of the financial services industry and provide opportunities to meet one-on-one with FINRA Risk Monitoring Analysts, Directors, and Single Points of Accountability to discuss firm-specific questions.
Register for these upcoming FINRA events:
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