Guidance

November 2020

FINRA is conducting a review of firms’ systems and procedures for providing customers waivers and rebates available through Rights of Reinstatement¹ (RoR) on mutual fund purchases.

As part of this review, FINRA will request that each firm that receives this information request respond to the questions below with respect to the period January 1, 2017 through June 30, 2020 (the relevant period):

A member must submit a letter requesting a materiality consultation for specified changes in ownership, control, or business operations, including business expansions, involving a defined “covered pending arbitration claim,” unpaid arbitration award or unpaid settlement related to an arbitration.  Such letter must be submitted through FINRA Firm Gateway^®, under the Materiality Consultation section.¹ There is no fee associated with a mandatory materiality consultation.

COVID 19 has increased the demand for virtual arbitration and mediation hearings to ensure cases can proceed without lengthy delays. Upon request of the parties or order of the Panel, FINRA Dispute Resolution Services provides videoconferencing through the Zoom platform, accessible via finra.zoom.us.

Registered representatives who are not qualified to engage in investment banking activities may, subject to specified conditions, receive transaction-based compensation for referring existing brokerage clients that express an interest in investment banking transactions.

Artificial Intelligence (AI) technology is transforming the financial services industry across the globe.

FINRA is a not-for-profit, self-regulatory organization (SRO) dedicated to promoting investor protection and market integrity in a manner that facilitates vibrant capital markets. One of FINRA’s tools for achieving this objective is fair and effective enforcement of our member firms’ compliance with securities laws and regulations.

Seniors make up an increasingly large share of the American population¹ and hold higher levels of wealth than other generations. These factors, among others, make seniors an attractive target for financial exploitation, with evidence suggesting that such exploitation has been increasing in terms of both scope and magnitude.² Sadly, while seniors sometimes fall victim to financial exploitation by strangers, they are often exploited by individuals they know and trust, such as family members or caregivers.