SEC Regulation Best Interest (Reg BI)

The SEC's Regulation Best Interest (Reg BI) under the Securities Exchange Act of 1934 establishes a "best interest" standard of conduct for broker-dealers and associated persons when they make a recommendation to a retail customer of any securities transaction or investment strategy involving securities, including recommendations of types of accounts.

As part of the rulemaking package, the SEC also adopted new rules and forms to require broker-dealers and investment advisers to provide a brief relationship summary, Form CRS, to retail investors. In addition, the SEC published interpretations concerning investment advisers’ standard of conduct under the Investment Advisers Act of 1940, and the "solely incidental" prong of the broker-dealer exclusion from the Advisers Act.

On This Page

Rules and Guidance

SEC Resources on RegBI

 

 

SEC Resources

The Securities and Exchange Commission provides information and resources on Regulation Best Interest, Form CRS and Related Interpretations.

More sec resources

 

FINRA Resources

More finra resources

FINRA

 

 

Events

Reg BI Events

FINRA and the SEC have hosted various events related to Reg BI and Form CRS implementation, standards and other guidance. View upcoming and past events.

View previous events

 

FINRA Staff Contacts

 

  • Regulatory Notice 23-08
    FINRA Reminds Members of Their Obligations When Selling Private Placements
    05/09/2023
  • Regulatory Notice 20-18
    FINRA Amends Its Suitability, Non-Cash Compensation and Capital Acquisition Broker (CAB) Rules in Response to Regulation Best Interest
    06/19/2020
  • Regulatory Notice 20-17
    FINRA Revises Rule 4530 Problem Codes for Reporting Customer Complaints and for Filing Documents Online
    06/10/2020
  • Regulatory Notice 19-26
    Regulation Best Interest
    08/07/2019

Reg BI and Form CRS Enforcement Actions

This webpage highlights enforcement actions brought by FINRA and the SEC that include a Reg BI or Form CRS violation. It is updated on a periodic basis and may not reflect the most recent actions.

FINRA Matters

The chart below lists FINRA disciplinary actions that include a Reg BI or Form CRS violation. For additional information, please visit FINRA Disciplinary Actions Online (and see Important Notes).

* AWC = Letter of Acceptance, Waiver, and Consent
Case ID Document Type Firm/Individual Action Date Violation(s) Related Material
2023079691201 AWC*  Elba M. Nogueras 9/18/2023 Reg BI  
2021070851501 AWC*  Network 1 Financial Securities, Inc.
 Michael Molinaro		 8/31/2023 Reg BI  
2022076459303 AWC*  Monmouth Capital Management LLC 7/6/2023 Reg BI & Form CRS News Release
2021069376801 AWC*  American Wealth Management, Inc. 5/19/2023 Form CRS  
2022076103701 AWC*  Axos Invest LLC 5/19/2023 Form CRS  
2021069357901 AWC*  Highlander Capital Group, Inc. 5/19/2023 Form CRS  
2021069277101 AWC*  Harpeth Securities, LLC 5/19/2023 Reg BI & Form CRS  
2021069380201 AWC*  DMK Advisor Group, Inc. 5/19/2023 Reg BI & Form CRS  
2020065599101 AWC *  SW Financial 5/12/2023 Reg BI News Release
2021071134401 AWC *   Jose M. Candelario Padilla 3/10/2023 Reg BI  
2021069365001 AWC *   Long Island Financial Group, Inc. 2/10/2023 Reg BI &
Form CRS		  
2020065683301 AWC *   Todd Anthony Cirella 1/31/2023 Reg BI  
2020065683302 AWC *   Edward Scott Short 1/31/2023 Reg BI  
2021069405501 AWC *   Charles V. Malico 10/11/2022 Reg BI  
2021072107601 AWC*   Aaron Capital Incorporated 5/25/2022 Form CRS  

SEC Matters

The chart below highlights SEC Enforcement actions against broker-dealers and associated persons that include a Reg BI or Form CRS violation. It is not intended to be a comprehensive listing of individual matters and subsequent history. For additional information regarding SEC enforcement, please visit https://www.sec.gov/page/litigation.

Document Summary Date Violation(s)
Release No. 34-98478 In the Matter of Carl M. Hennig, Inc., Respondent. 9/22/2023 Reg BI
SEC press release 2023-127 SEC Charges Former Army Financial Counselor Who Defrauded Gold Star Family Members 7/7/2023 Reg BI
SEC press release 2022-110 SEC Charges Firm and Five Brokers with Violations of Reg BI 6/16/2022 Reg BI
SEC press release 2022-27 SEC Charges 12 Additional Financial Firms for Failure to Meet Form CRS Obligations 2/15/2022 Form CRS
SEC press release 2021-139 SEC Charges 27 Financial Firms for Form CRS Filing and Delivery Failures 7/26/2021 Form CRS
  • 2023 Report on FINRAs Examination and Risk Monitoring Program
    Reg BI and Form CRS
    The Best Execution, Outside Business Activities and Private Securities Transactions, Private Placements, and Reg BI and Form CRS sections of the 2023 Report on FINRA’s Examination and Risk Monitoring Program (the Report) informs member firms’ compliance programs by providing annual insights from FINRA’s ongoing regulatory operations, including (1) regulatory obligations and related considerations, (2) findings and effective practices, and (3) additional resources.
    January 10, 2023
  • Media Center
    Regulation Best Interest and Form CRS: Two Years In
    We are marking the second anniversary of the implementation of Regulation Best Interest and Form CRS with a deep dive into everything FINRA has learned on the topic over the last two years. On this episode, we hear how FINRA is examining around the new regulations and explore some of the common problem areas and effective practices.
    June 28, 2022
  • 2022 Report on FINRAs Examination and Risk Monitoring Program
    Reg BI and Form CRS
    The Reg BI and Form CRS section of the 2022 Report on FINRA’s Risk Monitoring and Examination Activities (the Report) informs member firms’ compliance programs by providing annual insights from FINRA’s ongoing regulatory operations, including (1) relevant regulatory obligations and related considerations, (2) exam findings and effective practices, and (3) additional resources.
    February 09, 2022
  • Podcast
    Regulation Best Interest: Implementing a New Standard of Conduct
    As of June 30, 2020, the U.S. Securities and Exchange Commission’s Regulation Best Interest—or Reg BI—is officially in effect. What does a post implementation-date world look like? And how is FINRA working to ensure a consistent approach to examining around and enforcing the new regulation? Tune in to learn more.
    July 07, 2020
  • Virtual Conference Panel
    Regulation Best Interest: Compliance Inspections and Examinations
    Attend this session to hear from OCIE, FINRA staff and industry experts as they discuss how they intend to examine and inspect for compliance with Reg BI, including a discussion of implementation challenges, frequently asked questions, and issues that are being considered.
    May 12, 2020
  • Virtual Conference Panel
    Regulation Best Interest and Form CRS: Where Are We Now
    Join panelists as they discuss Regulation Best Interest and Form CRS, its impact on the industry and effective practices to help broker-dealers manage their obligations.
    May 06, 2020
  • Blog Post
    Highlights from FINRA’s Reg BI Conference for Member Firms

    FINRA hosted a Regulation Best Interest (Reg BI) conference on Dec.18, 2019 in Washington, D.C. for firms to discuss best practices and approaches. Approximately 500 compliance officers and other industry participants attended the one-day event focused on assisting firms as they gear up for the June 30, 2020 compliance date for the SEC’s Reg BI and Form CRS.

    January 08, 2020
  • Podcast
    Regulation Best Interest: Preparing for a New Standard of Conduct
    Soon brokerage firms will have to comply with a new standard of conduct when working with retail clients with the implementation of Regulation Best Interest. What is the new standard? What will firms need to do to comply? Tune in to learn more from FINRA’s Chief Legal Officer.
    October 15, 2019