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Preparation for CE and Registration Rule Changes

October 5, 2022
Volume 40


  • Regulatory Notice
disciplinary actions

Disciplinary Actions


Upcoming Deadlines and Effective Dates

  • FINRA Election Notices

Education and Compliance Programs

In preparation for the continuing education (CE) and registration rule changes that become effective, Jan. 1, 2023, FINRA is reminding firms of the tools available to support their registration compliance program. As a reminder, the rule changes described in Regulatory Notice 21-41 require registered persons to complete CE Regulatory Element annually by Dec. 31. Additionally, CE participants will receive content tailored to each representative or principal registration category that they hold. Individuals who fail to complete their Regulatory Element within the prescribed annual deadline of Dec. 31 will be designated as CE inactive.

FINRA has published the 2023 Regulatory Element topics to provide firms with sufficient time to review the topics as they prepare their Firm Element training for the upcoming year. In addition, industry professionals should create and maintain a FinPro account because they will take their Regulatory CE sessions in FinPro. Firms can take advantage of FinPro’s tools to support their registration compliance program. Visit the CE Transformation page on FINRA’s website for more information.


On the latest episode of FINRA Unscripted, Patricia Monterosso and Nicole Lefort from FINRA’s Credentialing, Registration, Education and Disclosure team speak about how the Maintaining Qualifications Program is progressing and what firms can expect with regard to changes to the CE Regulatory Element in the months ahead. Listen to the podcast.

FINRA’s Rule 4111 Compliance Tool provides, as they are issued, reports of: (1) the annual calculation of whether the member firm met the Rule 4111 Preliminary Criteria for Identification, including its Preliminary Identification Metrics, as of the Evaluation Date for a given year; and (2) interim calculations as of an Evaluation Date for that given year.

A new report of interim calculations as of the June 1, 2023 Evaluation Date is now available via the tool, and entitled users of all firms were recently notified of its availability. As a reminder, the reports of interim calculations are generated for informational purposes only; whether a firm will meet the Preliminary Criteria for Identification in the annual calculation could change based on subsequent events.

Visit FINRA’s Compliance Tools page for more information about the Rule 4111 Compliance Tool, including access instructions.

Take advantage of our reduced registration rates and attend our new Firm Grouping Conference on December 1, 2022, in Kissimmee, FL. This event is designed to provide financial professionals associated with FINRA member firms the opportunity to engage in conference panels tailored to their specific firm grouping. Join FINRA staff and industry peers for thoughtful discussions around the future landscape of the financial services industry.


The NAC has revised FINRA’s Sanction Guidelines, which guide FINRA adjudicators in developing remedial sanctions for violations of the securities rules. These revisions in Regulatory Notice 22-20 were based on a review to ensure that the guidelines accurately reflect the levels of sanctions imposed in FINRA disciplinary proceedings and are effective immediately.


 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.

  • An extended hearing panel expelled broker-dealer NYPPEX, LLC and barred its former CEO Laurence Allen for failing to respond in a timely and complete manner to FINRA requests for information and documents. The panel also found that NYPPEX and Allen engaged in securities fraud. In addition, the panel barred NYPPEX’s current CEO and Chief Compliance Officer Michael Schunk in any principal or supervisory capacity for his failure to supervise Allen and suspended him for two years in all capacities for engaging in other misconduct—the maximum suspension under FINRA’s sanction guidelines.
  • FINRA fined UBS Securities LLC (UBS) $2.5 million for Regulation SHO (Reg SHO) violations and supervisory failures spanning a period of nine years. It was found that, from 2009 to 2018, UBS did not timely close out at least 5,300 failure to deliver positions and routed or executed more than 73,000 short sales in securities with an unsatisfied close-out requirement without first borrowing or arranging to borrow the shares. Additionally, UBS’s supervisory systems, including its written procedures, were not reasonably designed to achieve compliance with the requirements of Rule 204 of Reg SHO.
  • Barclays Capital Inc. (Barclays Capital) has been fined $2 million for failing to comply with its best execution obligations in connection with its customers’ electronic equity orders. From January 2014 through February 2019, Barclays Capital owned and operated an alternative trading system known as LX. Barclays Capital routed all its customers’ marketable orders to LX, prior to routing to any competing venue, if the order could be filled in LX completely or partially at the National Best Bid and Offer or better, unless customers opted out of this routing preference. Barclays Capital failed to conduct reasonable reviews of execution quality for its customers’ orders, did not review price improvement data for orders routed to LX, and did not review speed of execution for any of the venues to which it routed customers’ orders or consider whether the firm could have obtained better execution speed from competing markets.
 Upcoming Deadlines and Effective Dates

FINRA Elections

FINRA is holding several elections to fill seats on the Small Firm Advisory Committee (SFAC), Regional Committees, National Adjudicatory Council (NAC) and the FINRA Board of Governors.

  • One seat on the SFAC representing the New York region is up for election. Individuals interested in becoming candidates for this election must submit a candidate profile form to FINRA’s Corporate Secretary by October 6, 2022.
  • Election Notice 09/06/22 describes the nomination and election process to fill vacancies on FINRA’s Regional Committees. Regional Committees for the South and West regions each have six full-term vacancies, and the Midwest, North and New York regions each have four full-term vacancies to fill. Eligible candidates will be included on the appropriate ballot if they submit a candidate profile form to FINRA’s Corporate Secretary by October 6, 2022.
  • As described in Election Notice 08/22/22 FINRA is holding an election to fill one small firm seat on the NAC. Eligible individuals who obtain the requisite number of valid petitions may be included as candidates on the ballot by following the petition procedures described in the Election Notice. Petitions for candidacy are due October 6, 2022.
  • FINRA is holding a special meeting of large firm members on or about October 31, 2022, to elect one individual to fill a vacant Large Firm Governor seat on the FINRA Board of Governors. Election Notice 08/09/22 announces the FINRA Nominating & Governance Committee nominee—Penny Pennington, Managing Partner at Edward Jones—and informs individuals of the procedures for being included as a petition candidate on the ballot.

 Education and Compliance Programs

The U.S. Department of the Treasury is offering a virtual workshop on October 21 at 1:00 p.m. ET on Treasury’s auction rules. Aimed towards market professionals who are new to, or would like to refresh their knowledge of, the auction process and whose firms participate in Treasury auctions, this workshop will provide an overview of the auction rules, including examples of auction related calculations.

Limited seats are available at Advertising Regulation Conference. Join us in Washington, DC, on October 20-21, 2022, for a conference designed specifically for new and experienced communications compliance professionals. Participate in forward-looking discussions on current practices, policies, priorities and rulemaking. Plus, use this opportunity to network with industry peers and meet one-on-one with Advertising Regulation Department staff during office hours.

View the agenda for the 2022 Small Firm Conference. Join us in Santa Monica, CA, or participate virtually on November 9-10, for the opportunity to discuss small firm topics, share insights and effective practices, and hear detailed exchanges on industry and regulatory updates.

View the latest Virtual Conference Panel: Tips for Handling Emotional Callers. FINRA staff and industry panelists outline strategies to help you and your staff manage and diffuse emotional callers. During the session, panelists explore scenarios and provide tips on how to manage angry, frustrated or emotional clients.

Listen to the recording of the latest Small Firm Conference Call: SEC’s Regulation Best Interest and Form CRS. FINRA President and CEO Robert Cook and Vice President of Member Relations and Education Kayte Toczylowski are joined by Associate General Counsel Meredith Cordisco, Senior Director of National Cause and Financial Crimes Detection Programs Nicole McCafferty, and Examination Director of Diversified, Carrying & Clearing Examinations Justin Triolo to discuss the SEC’s Regulation Best Interest (Reg BI) and Form CRS.

The full agenda

for the 2022 FINRA Diversity Leadership Summit, Resilience in a Time of Transition is now available. This event is free of charge and will be hosted virtually, with sessions each afternoon from October 25-27. Register today.

Register for all of FINRA’s upcoming events:

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