About the Advertising Regulation Department

The Advertising Regulation Department (the “Department”) protects investors by helping to ensure that broker-dealers’ communications with the public are fair, balanced, and not misleading. The Department reviews communications such as websites, search advertisements, brochures, commercials, and print communications for compliance with applicable FINRA, SEC, MSRB, and SIPC rules through four key programs:

Filings Review: The Department reviews communications filed by broker-dealers primarily in response to filing requirements in FINRA Rules 2210 and 2220. FINRA charges fees for the review of these filings pursuant to Schedule A of FINRA’s Bylaws. Department staff analyzes each communication filed and provides the firm with a written review letter indicating whether the communication requires revisions in order to comply and, if so, what changes are needed. In an egregious situation, the staff will instruct a firm to cease using the communication. The staff commonly addresses issues such as misleading language or the depiction of the risks and costs relating to retail products or investment performance.

Complex Reviews: The Department provides support to FINRA Member Supervision staff and other FINRA departments by analyzing communications that may contain possible violations of the advertising rules discovered during examinations and enforcement proceedings. The Department may also receive direct referrals of problematic communications. As appropriate, the staff may contact broker-dealers to obtain additional information to evaluate the communications or, when rule violations are indicated, to ensure that problematic communications are stopped. Based on its analysis, the Department may issue informal disciplinary actions directly or may refer more significant matters to FINRA Member Supervision or Enforcement for in-depth examination.

Spot Checks: The Department periodically requests that selected groups of broker-dealers provide for review communications that normally are not subject to the filing requirements. These spot check reviews generally target areas of regulatory concern such as a new type of product or investor protection issue. If a review reveals rule violations, the staff will contact the firm to ensure the problematic communications are stopped. The staff may pursue informal disciplinary action or refer the matter for further examination as with Complex Reviews above.

Outreach: The Department staff provides education and training to the industry and other regulators by hosting its own conference on advertising regulation in Washington, D.C. and participating in FINRA’s Annual Conference, district preventive compliance conferences, and industry-sponsored events. Department staff routinely contributes to FINRA’s on-line training resources such as e-Learning, podcasts, and the Department’s webpage at www.finra.org/advertising.