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On the Front Lines of Investor Protection During COVID-19 Pandemic

Jessica Hopper

"COVID-19 has changed the way many of us live and work, and has had an unprecedented impact on the securities markets. What has not changed, however, is FINRA’s commitment to protecting investors and market integrity. Now, more than ever, it is important that FINRA Enforcement act quickly and aggressively to stop those who would use these uncertain times to take advantage of vulnerable investors or to manipulate the markets. I can assure you that the staff within FINRA’s Enforcement department stands ready, on the front lines of investor protection, to fulfill this mission."

– Jessica Hopper, Executive Vice President, FINRA Enforcement

Who We Are

FINRA Enforcement works on the front lines of investor protection.

We advance confidence in the securities markets through vigorous, fair and effective enforcement of FINRA and MSRB rules, and federal securities laws and rules. We act quickly to identify misconduct, stop fraud and prevent losses, obtain restitution for harmed investors and remove bad actors from the brokerage industry.

We dedicate our resources to bringing meaningful enforcement actions to correct wrongdoing and deter future misconduct and to rooting out the bad actors that pose the greatest risk of harm to investors and the markets. Our priorities are:

  • obtaining restitution for harmed customers;
  • ridding the industry of brokers engaged in misconduct involving fraud or other egregious misconduct—especially brokers with a past history of misconduct;
  • protecting seniors and vulnerable investors; and
  • ensuring the integrity of the markets.

What We Do

FINRA investigates potential securities violations and, when appropriate, brings formal disciplinary actions against firms and their associated persons. FINRA investigations may be opened from various sources, including automated surveillance reports, examination findings, filings made with FINRA, customer complaints, tips, referrals from other regulators or other FINRA departments and press reports.

If it appears that rules have been violated, Enforcement will determine whether the conduct merits formal disciplinary action. FINRA can take disciplinary action through two separate procedures: a settlement or a litigated proceeding. With a settlement, the respondent can opt to resolve alleged rule violations early by submitting a Letter of Acceptance, Waiver and Consent (AWC). Otherwise, FINRA may issue a formal complaint to FINRA’s Office of Hearing Officers (OHO). If the respondent does not settle the complaint, the matter proceeds to a contested hearing before OHO, which hears the case and issues a decision.

Enforcement also brings disciplinary cases on behalf of the securities exchanges with which it has entered into Regulatory Services Agreements (RSAs). These matters may be brought on behalf of a single exchange or, more commonly, may be brought as global settlements on behalf of multiple self-regulatory organizations, sometimes including FINRA.

Sanctions for wrongdoing include fines, suspensions, and, in cases of serious misconduct, bars from the brokerage industry. FINRA publishes its Sanction Guidelines so that members, associated persons and their counsel understand the types of disciplinary sanctions that may be applicable to various violations. Whenever possible, Enforcement orders firms and individuals to make restitution to harmed customers.

Not all investigations result in formal disciplinary action. For example, if the violation is of a minor nature and there is an absence of customer harm or detrimental market impact, the matter may be resolved with an informal disciplinary action, such as the issuance of a Cautionary Action. While Cautionary Actions are considered by the staff in any future disciplinary matter, these actions do not constitute formal discipline and are not reportable on FINRA's Central Registration Depository (CRD) system or Form BD.

In addition, Enforcement may determine not to recommend formal disciplinary action following an investigation and may close the matter without further action.

See Our Results

Enforcement believes in a fair and transparent process—which is why all formal disciplinary actions we take are available through a publicly accessible online search tool called FINRA Disciplinary Actions Online. In addition, FINRA publishes a monthly summary of recent disciplinary actions.

Join FINRA Enforcement

Do you have the passion and expertise to help FINRA protect investors and ensure confidence in the securities markets? Learn more about what it is like to work in Enforcement and explore job openings in the department.