Category: Supervision

It has been an exciting year for Securities Compliance Management (“SCM”)

The Ultimate Solution for Compliance Management

Posted on by SCM Communications

It has been an exciting year for Securities Compliance Management (“SCM”). The Firm has successfully: Initiated numerous New Membership Applications (“NMAs”) for new firms seeking the Financial Industry Regulatory Authority’s (“FINRA”) approval, Initiated several Continuous Membership Applications (“CMAs”) for existing firms that are planning to undergo a material change in their line of business operations, Partnered with new broker-dealer and registered investment advisor firms to assist them with their FinOp and/or compliance programs, and Assisted in the buy/sell of existing broker-dealer firms. Along with the new relationships that Securities Compliance Management has established this year, the Firm is also incredibly Read more about The Ultimate Solution for Compliance Management[…]

Three Main Focal Points of Newly Registered Firms

Exam Observations for New Firms

Posted on by SCM Communications

In March 2023, the Securities and Exchange Commission (“SEC”) released an alert article with some observations that they have seen when examining newly registered firms. Note that these alerts are not rules or regulations of any regulatory authority. However, investment advisory firms and broker dealers can garner many important takeaways that may assist the firm during an examination. It is important for any new firm – whether broker dealer or registered investment advisor – to start communicating and engaging with its regulatory contacts. Having an open line of communication can provide value to investment advisors and/or broker dealers in building Read more about Exam Observations for New Firms[…]

FINRA Rule 3110 Amendment Proposals

FINRA Rule 3110 Amendment Proposals

Posted on by SCM Communications

The Financial Industry Regulatory Authority (“FINRA”) Rule 3110 gives explicit directives on supervision of all persons related to the broker dealer in order to stay in compliance with all applicable FINRA rules and regulations. Although it takes a solid compliance program to achieve this, it has been manageable. Enter COVID-19: “Stay at home for two weeks to flatten the curve” they said. With that, employees packed up their work, and so began the lifestyle of working from home (“WFH”). The Financial Industry Regulatory Authority had to ease up on broker dealer’s completing branch audits during this time simply due to Read more about FINRA Rule 3110 Amendment Proposals[…]

Cyber security is complex and cyberthreats are constantly evolving. Therefore, a substantial challenge that many firms face is that they just do not have the in-house resources available to dedicate a team of individuals to a cyber security program.

Cyber Security – Is the “Blind leading the Blind?”

Posted on by SCM Communications

As consultants, we can’t emphasize enough the importance of having a proactive cyber security program that is specifically tailored to protect disruption of critical systems as well as protection of sensitive data for both the firm and its customers.

Key Steps for Starting a Broker-Dealer

Key Steps for Starting a Broker-Dealer

Posted on by SCM Communications

Individuals and companies desire to start a broker-dealer for many reasons including to facilitate sales, create an entry point for foreign financial institutions, or be a part of a larger financial plan. Some of the benefits to starting a broker-dealer (vs. purchasing an existing one) include saving money on due diligence, having no prior regulatory or financial issues, and the ability to customize it to fit your desired products and business lines. If you are looking for more pros and cons to starting vs. Buying a broker-dealer, read one of our recent posts on the topic “here”. If you decide Read more about Key Steps for Starting a Broker-Dealer[…]

Merrill Mutual Fund Enforcement Lessons Learned

Merrill Mutual Fund Enforcement Lessons Learned

Posted on by admin

FINRA (Financial Industry Regulatory Authority) announced on June 2, 2022 that it ordered Merrill Lynch, Pierce, Fenner & Smith, Inc., to pay 15.2 million in restitution and interest to thousands of customers who purchased Class C mutual fund shares when Class A shares were available at a substantially lower cost. FINRA news releases are useful tools to look for trends in violations and other sanctions. These trends can assist you in identifying weak areas in your Firm’s compliance programs or surveillance. Below is a summary of the Merrill order, as well as key takeaways. Click here for the corresponding news Read more about Merrill Mutual Fund Enforcement Lessons Learned[…]