Broker-Dealer Archives - Page 4 of 30

Options Disclosure Document Update

Posted on August 5, 2022 by admin

This is a reminder for broker-dealers who provide options services to their clients, that certain disclosure documents are required including the options disclosure document (“ODD”). In May 2022, FINRA provided an information notice to update firms on the options clearing corporation (“OCC”) disclosure document issued in March 2022. Under rule 9b-1 of the Securities Exchange Act broker-dealers are required to deliver the ODD and supplements to customers. FINRA has similar requirements in FINRA Rule 2360(b)(11)(A)(1), which, among other things, requires firms to deliver the current ODD to each customer at or before the time the customer is approved to trade Read more about Options Disclosure Document Update[…]

FINRA Unscripted Podcast: Regulation Best Interest and Form CRS Two Years In

Posted on July 15, 2022 by admin

FINRA recently released a podcast Regulation Best Interest and Form CRS: Two Years In. This podcast provides a great update on the current Regulation Best Interest and Form CRS trends and best practices as well as common problem areas and effective practices to compliance. A few highlights from the podcast: Regulation Best Interest vs. Form CRS Reg BI applies to any retail firm or any firm with retail customers where recommendations are being made whereas Form CRS applies to any Firm that has retail investors including Firms that offer solely self-directed business. The podcast notes that there is no de Read more about FINRA Unscripted Podcast: Regulation Best Interest and Form CRS Two Years In[…]

FINRA Unscripted Podcast: AML Update

Posted on July 8, 2022July 8, 2022 by admin

FINRA recently released a podcast AML Update: The Latest Trends and Effective Practices . This podcast provides a great update on the current AML and fraud trends and best practices from Jason Foye, Senior Director of the National Cause and Finance Crimes Detection Program’s Special Investigative Unit . A few highlights from the AML update podcast: Financial Crimes Enforcement Network (FinCEN) Priorities On June 30, 2021, FinCEN posted a bulletin that set out eight priorities, focused on threats to the U.S. financial system and national security. These priorities include corruption, cybercrime (including relevant cybersecurity and virtual currency considerations), foreign and Read more about FINRA Unscripted Podcast: AML Update[…]

Account Takeover Attempts

Posted on July 1, 2022 by admin

FINRA recently organized roundtable discussions with representatives from 20 firms of various sizes and business models to discuss their approaches to mitigating the risks from account takeovers. Account takeover attempts (ATO) are when bad actors are using stolen or synthetic identification material to open accounts at firms that they then use to generate or launder illicit proceeds. Regulators noted a post pandemic rise in online account opening. These activities make it particularly difficult, because the identities are stolen so even with a SARS filed the true identity of the bad actor is generally never known. Regulatory Notice 21-18 shares a Read more about Account Takeover Attempts[…]

Merrill Mutual Fund Enforcement Lessons Learned

Posted on June 24, 2022 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[…]

Customer Complaint Report

Posted on May 27, 2022 by admin

The Customer Complaint Report is a quarterly report that displays trends in complaints reported to FINRA’s Rule 4530 Application each quarter, pursuant to FINRA Rule 4530. When a customer complaint is submitted to FINRA, the submitter must identify the product and problem classification detailed in the complaint. The report allows a firm to see their complaints in two views, by problem identified in the complaint and by product for which the complaint was submitted. Navigating the Customer Complaint Report The complaints by problem view is displayed by default. To see complaints submitted by product, choose Product from the Views drop-down Read more about Customer Complaint Report[…]