Blog
Business Continuity Plan: Pandemic Preparedness
In accordance with FINRA Rule 4370 (Business Continuity Plans and Emergency Contact Information), a broker-dealer must have a business continuity plan addressing numerous elements, one of which is financial and operational assessments. This element requires the broker-dealer to assess the operational and other risks related to a significant business disruption, [...]
TRACE: Rule Change Related to Treasuries
FINRA is proposing to expand the Trade Reporting and Compliance Engine (‘‘TRACE’’) reporting rules to include most secondary market transactions in marketable U.S. Treasury securities. The market in U.S. Treasury securities—or ‘‘Treasuries’’ —is the deepest and most liquid government securities market in the world. Treasuries are traded by broker-dealers as [...]
TRACE Trade Reports: Time of Execution
Broker-Dealer firms are required under FINRA Rule 6730 (Transaction Reporting) to report the “time of execution” of a transaction in TRACE trade reports. The time of execution is defined as the time when the parties to a transaction in a TRACE-eligible security agree to the material terms of the transaction [...]
General Solicitation Under Rule 506(c)
General Solicitation Under Rule 506(c) In 2013 and in accordance with the Jumpstart Our Business Startups Act (the JOBS Act), the SEC amended Rule 506 of Regulation D under the Securities Act of 1933 to permit the use of general solicitation in securities offerings conducted under new Rule 506(c). Rule [...]
FINRA Rule 2111: Getting to Know Your Client
Suitability is one of the most important concepts for an investment professional to understand. Before an investment professional can make recommendations or decisions on behalf of an investor, he must understand what investments are suitable for the investor’s account. The purpose of FINRA establishing the suitability standard, FINRA Rule 2111, [...]
Loss of Key Personnel: How to Prepare
The loss of key personnel can have a devastating effect on a financial institution, especially small investment advisory firms. In a worst-case scenario, the loss forces the firm to shut down and leaves clients without a financial advisor to manage their money. The North American Securities Administrators Association (“NASAA”) addressed [...]