Rialto Markets LLC Comment On Regulatory Notice 26-14

September 9, 2026

Jennifer Piorko Mitchell

Office of the Corporate Secretary

FINRA

1700 K Street, NW

Washington, DC 20006

Re: Regulatory Notice 26-14 – Proposed Changes to Modernize Rule 2210 (Communications with the Public)

Dear Ms. Mitchell:

Rialto Markets LLC (“Rialto”) appreciates the opportunity to comment on FINRA Regulatory Notice 26-14 and strongly supports FINRA’s proposal to replace the prescriptive principal pre-use approval requirement for retail communications with a more flexible, risk-based supervisory framework.

Rialto is a small, broker-dealer whose business includes assisting issuers with exempt and private securities offerings. From our perspective, the proposal has the potential to improve communications supervision by allowing firms to focus qualified principal resources on communications presenting the greatest regulatory and investor-protection risks.

Risk-Based Supervision

Under the current framework, communications subject to Rule 2210’s pre-use approval requirement must generally be approved by an appropriately qualified registered principal regardless of the level of risk presented by the communication.

At Rialto, for example, an experienced Series 7-registered individual is involved in preparing certain firm communications. Routine and factual communications subject to the pre-use approval requirement must nevertheless be routed to an appropriately qualified principal in much the same manner as communications requiring substantially greater regulatory judgment.

We believe there is an important distinction between eliminating supervision and modernizing how supervision occurs.

A risk-based framework could permit appropriately trained and experienced registered personnel to prepare and disseminate defined categories of lower-risk communications without transaction-by-transaction principal approval, while preserving principal pre-use review for higher-risk communications involving such matters as performance information, investment recommendations, material investment claims, novel products or strategies, or statements concerning expected returns, income or liquidity.

The principal would remain responsible for establishing the supervisory framework, determining appropriate risk categories and escalation criteria, overseeing training, reviewing surveillance and testing, and addressing exceptions. For a small broker-dealer, this would allow limited principal resources to be focused on communications that require substantive regulatory judgment.

Implementation, Documentation and Regulatory Clarity

Rialto encourages FINRA to provide practical guidance regarding how firms may reasonably implement and document the proposed risk-based framework.

In particular, FINRA could clarify that firms may establish risk classifications at the category or activity level through their written supervisory procedures without requiring a separate documented risk determination for every individual communication.

Guidance would also be helpful regarding reasonable surveillance and sampling methodologies, documentation expectations, periodic reassessment of risk classifications, and circumstances requiring escalation to principal review.

We also encourage FINRA to consider whether additional guidance regarding Rule 2210’s substantive content standards would help firms implement the proposed supervisory framework more consistently.

Standards such as “fair and balanced,” “promissory,” “unwarranted” and “misleading” necessarily require judgment and consideration of context. While principles-based standards provide important flexibility, they can also make it difficult for firms—particularly smaller firms with limited compliance resources—to determine prospectively whether particular language might later be viewed by regulatory staff as compliant.

This uncertainty becomes more significant under a risk-based supervisory framework. Firms may be reluctant to exercise the flexibility FINRA intends to provide if both the supervisory classification and the underlying communication remain subject to substantial after-the-fact judgment.

Accordingly, we encourage FINRA to provide additional examples or guidance illustrating how these content standards apply to common types of modern communications, including social media and digital marketing. Greater clarity would help firms develop more consistent internal standards, train registered personnel more effectively and identify the communications that genuinely warrant heightened principal review.

Importantly, examination of a risk-based program should focus on whether the supervisory framework was reasonably designed, documented and implemented based on the information available at the time, rather than whether a regulator, with hindsight, might have classified or worded an individual communication differently.

Conclusion

Rialto strongly supports FINRA’s move toward risk-based supervision of retail communications. For smaller firms in particular, the proposal presents an opportunity to direct qualified principal resources toward the communications presenting the greatest risk while maintaining appropriate supervision of lower-risk communications.

We encourage FINRA to preserve that flexibility in any final rule and provide practical guidance concerning risk classification, documentation, surveillance, escalation and application of Rule 2210’s principles-based content standards. Doing so will help ensure that firms can use the proposed framework confidently and consistently while maintaining strong investor protections.

We appreciate FINRA’s consideration of these comments.

Respectfully submitted,

Rialto Markets LLC