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Register for FINRA’s Senior Investor Protection Conference

October 16, 2019
Volume 42


  • Regulatory Notice
  • FINRA Elections
disciplinary actions

Disciplinary Actions


Upcoming Deadlines and Effective Dates
  • FINRA Request for Comment

Education and Compliance Programs

FINRA issued an Investor Alert on trading binary options. The alert, Binary Options: These All-Or-Nothing Options Are All-Too-Often Fraudulent, explains that when a binary option expires, it either makes a pre-specified amount of money, or nothing at all, in which case investors lose their entire investment. It also states that trading binary options is made even riskier by fraudulent schemes, many of which originate outside the U.S.

Register today to attend FINRA’s Senior Investor Protection Conference on November 12 in Washington, D.C. This one-day event is dedicated to sharing the most up-to-date regulatory information, effective strategies and solutions for protecting senior investors and vulnerable adults.

FINRA published its 2019 Report on FINRA Examination Findings and Observations. The report reflects key findings and observations identified in recent examinations, and contains effective practices that could help firms improve their compliance and risk management programs. It summarizes findings and observations across a range of topics, including supervision, cybersecurity, best execution, segregation of client assets, and Uniform Transfers to Minors Act (UTMA) and Uniform Grants to Minors Act (UGMA) accounts.

DXT: Send us your feedback on online support and data APIs. The FINRA Digital Experience Transformation (DXT) initiative, a multi-year effort to integrate and simplify brokerage firms' digital interactions with FINRA, is seeking input from users through monthly lightning feedback exercises. This month we are asking for your input on online support and data APIs, and we continue to seek input on the new landing page concept. Learn more and send us your feedback via our website.


Retrospective Rule Review Report and Guidance: Annual Compliance Meetings

FINRA launched a retrospective review of the annual compliance meeting (ACM) requirement in Rule 3110(a)(7) and corresponding Supplementary Material .04 (SM .04), to assess its effectiveness and efficiency. Based on the assessment, which involved feedback from both internal stakeholders and a wide range of external stakeholders, FINRA has determined to maintain the requirement without change. Regulatory Notice 19-34 summarizes the review process, the predominant themes that emerged from stakeholder feedback and the basis for the determination.

FINRA Elections
FINRA has issued SFAC Election Notice 10/21/19 to notify FINRA small firm members that ballots to elect one New York Region representative to the Small Firm Advisory Committee (SFAC) have been mailed to all eligible firms. FINRA small firm members1 in the New York Region as of the close of business on Friday, October 18, 2019, are eligible to vote in these elections. All eligible firms are urged to vote in this election. Ballots are due by November 20, 2019.

FINRA has issued Regional Election Notice 10/21/19, which notifies firms of the upcoming elections to fill vacancies on the FINRA Regional Committees, and the mailing of ballots to eligible firms. Firms that are members of FINRA as of the close of business on Friday, October 18, 2019, are eligible to vote for the contested seats on the Regional Committee corresponding to the district in which their firm is headquartered. Ballots are due by November 20, 2019.


  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:

  • FINRA announced it has barred Ami Forte and Charles Lawrence of Florida for their respective roles in churning accounts belonging to a 79-year-old customer who suffered from severe cognitive impairment. Forte first met the customer (identified as “RS” in the settlement) in the late 1990s, at which time the two developed a romantic and business relationship. Forte, who maintained near daily contact with RS, used her position of trust and confidence to exploit RS and generate excessive commissions from his accounts.

 Upcoming Deadlines and Effective Dates

FINRA Request for Comment

FINRA and the other participants of the Consolidated Quotation (CQ) Plan and the Nasdaq Unlisted Trading Privileges (UTP) Plan have issued a proposal for adding odd lot quotation information to the Securities Information Processor or “SIP” data feeds. The Plan participants are actively seeking input on the proposal, which is available on both the CTA website and UTP website. Comments are due by November 15, 2019.

 Education and Compliance Programs

FINRA's Small Firm Conference Call is a free series hosted by senior FINRA leaders who discuss trending topics, new rules and regulatory guidance and best practices. The recording from the October 8 conference call on the SEC’s Regulation Best Interest is now available. Visit our website for more information and to hear previous recordings.

FINRA is hosting an AML Half-Day Seminar on November 14 in Boca Raton, FL. Register today to reserve your spot.

District compliance events are designed for compliance and legal professionals at FINRA member firms, and offer an opportunity to hear about current regulatory issues while engaging with District Office staff. Review the compliance calendar to see a complete list of events.

FINRA’s 2019 Regulation Best Interest Conference will be held on December 18 in Washington, D.C. This one-day event is designed to bring regulators, executives and industry practitioners together to learn more about the SEC’s Regulation Best Interest (Reg BI). FINRA is offering free registration to the first two attendees from each firm. Register today to reserve your spot.

Also coming up:

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Regulatory Contacts
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