Guidance

Clarification of NASD Notice to Members 94-44 to situations in which a dually registered person maintains discretionary trading authority, determines portfolio changes, and prepares trade instructions for customer accounts and charges the accounts an asset-based fee.

Whether a proposed standby purchase agreement entered into between affiliate of a member and an issuer in connection with a public offering of the issuer's common stock could constitute an option.

Cash rebates issued to pension plan customers with respect to secondary market transactions in outstanding securities (under former Article III, Section 24, now Rule 2740 and IM-2740).

The Daily Total Summary Data and Detail Data Download files for the OATS Compliance Report Card provide underlying totals and detail of the data contained in the monthly summary OATS Compliance Report Card.

The tables below represent the data within the Daily Totals Summary Report Card and the Detail Data Download files.

Summary Definitions and Data Fields

FINRA360 has yielded a number of organizational and operational changes aimed at making FINRA a more efficient, more effective regulator.

Regulatory Obligations

FINRA Rule 2090 (Know Your Customer) requires member firms and their associated persons to use reasonable diligence to determine the “essential facts” about every customer and “the authority of each person acting on behalf of such customer.” Regulatory Notice 11-02 (SEC Approves Consolidated FINRA Rules Governing Know-Your-Customer and Suitability Obligations) advised that firms verify the essential facts about a customer “at intervals reasonably cal

The Municipal Primary Offering Disclosure Report displays statistics about transactions your firm effected with customers during the securities’ Primary Offering Disclosure Period. This report is designed to aid firms in monitoring their compliance with Rule G-32(a) customer disclosure requirements, which apply to all broker-dealers selling offered municipal securities.

FINRA recently released a number of Regulatory Notices that support the effort to modernize rules for member firms and associated persons. This webinar is designed to review the comment process, assist firms with how to comment and provide what type of information is helpful to receive in comments. FINRA staff share examples of the impact of comment letters and how they were used. 

Background

Input from our stakeholders indicated that they would welcome greater transparency regarding FINRA's budget, especially its financial projections and potential use of fines. FINRA for many years has published an Annual Financial Report that is prepared and audited in accordance with GAAP⁶ that describes the prior year's finances and operations.

Regulatory Obligations

Regulation SHO Rules 200 to 204 require firms to address risks relating to market manipulation, market liquidity and investor confidence by regulating excessive and “naked” short sales so that purchasers of securities from short sellers receive their securities positions in a timely manner. Regulation SHO requires firms to appropriately mark their securities orders; confirm that they have deliverable securities to complete short sale transactions; and have a process to close-out fails to deliver within the required timeframes.

The MSRB Due Diligence Report Card is a monthly status report to help firms monitor their issuances being brought to market in order to support firm's due diligence efforts.  The report shows how many total issuances have been brought to market and which of those had issuers with previous issuances in the market that are lacking current audited financial filings (LCF) on EMMA.  If any of the issuances being brought to market have a previously issued CUSIP LCF, then the current issuance is identified on this report card.

The report offers two alternative views: