Compliance Archives - Page 4 of 17

Customer Account Transfer

Posted on May 13, 2022May 13, 2022 by admin

From time to time, customers may look to move their account to a new brokerage firm for a wide variety of reasons, such as better or wider variety of services or lower costs. It may also be that the customer has learned the broker is under investigation by regulators or has apparently committed rule violations in connection with the account. Whatever the reason, your firm must respect customer account transfer instructions. Automated Customer Account Transfer Service (ACATS) This can be accomplished by using the Automated Customer Account Transfer Service or ACATS for short. The receiving member firm will initiate the Read more about Customer Account Transfer[…]

Customer Complaints (FINRA Rule 4513)

Posted on May 6, 2022 by admin

FINRA Rule 4513 defines a “customer complaint” as any grievance by a customer or any person authorized to act on behalf of the customer involving the activities of the member or a person associated with the member in connection with the solicitation or execution of any transaction or the disposition of securities or funds of that customer. Customer complaints that are made in person or over the phone are not within the scope of this rule, however, it is still prudent for members to address these complaints so that they do not escalate further. If a complaint is resolved to Read more about Customer Complaints (FINRA Rule 4513)[…]

Outside Business Activity Disclosure Form Best Practices

Posted on April 29, 2022 by admin

When creating an outside business activity (“OBA”) disclosure form, it’s important to understand how FINRA defines an outside business activity and what information must be disclosed. Firms can request additional information however it is recommended that Firm’s ensure the required information is collected, reviewed and approved by the Firm’s designated principal. What is an Outside Business Activity? An outside business activity (“OBA”) is defined as a registered person acting as an “employee, independent contractor, sole proprietor, officer, director or partner of another person, or be compensated, or have the reasonable expectation of compensation, from any other person as a result Read more about Outside Business Activity Disclosure Form Best Practices[…]

NASAA Reveals Top Investor Threats for 2022

Posted on April 22, 2022 by admin

On January 10, 2022 the North American Securities Administrators Association (NASAA) released its annual list of top investor threats for 2022 and urged caution before purchasing popular and volatile unregulated investments – especially those involving cryptocurrency and digital assets. NASAA also announced guidance for investors, including steps to take to protect from fraud in the new year. “The most common telltale sign of an investment scam is an offer of guaranteed high returns with no risk. It is important for investors to understand what they are investing in and with whom they are investing,” said Melanie Senter Lubin, NASAA President Read more about NASAA Reveals Top Investor Threats for 2022[…]

FINRA Announces Rule 4111 (Restricted Firm Obligations) Evaluation Date

Posted on April 15, 2022 by admin

In an Information Notice released February 1, 2022, FINRA announced the first “Evaluation Date” for the new Rule 4111 (Restricted Firm Obligations) on June 1, 2022. Rule 4111 went into effect on January 1, 2022, and addresses firms with a significant history of misconduct. More specifically, it requires member firms that are identified as Restricted Firms to deposit cash or qualified securities in a segregated, restricted account; adhere to specified conditions or restrictions; or comply with a combination of such obligations. Rule 4111 Rule 4111 establishes a multi-step, annual process through which FINRA will determine whether a member firm raises Read more about FINRA Announces Rule 4111 (Restricted Firm Obligations) Evaluation Date[…]

2022 & 2023 Continuing Education Requirements for IARs

Posted on April 8, 2022 by admin

In November of 2020, the North American Securities Administrators Association (“NASAA”) adopted a new rule (PDF) that will require Investment Advisor Representatives (“IARs”) to complete 12 credit hours of Continuing Education annually, 6 for IAR Ethics and Professional Responsibility Requirements and 6 for IAR Products and Practice Requirements. This will be the first time IARs have been subject to Continuing Education requirements and as NASAA president Lisa A. Hopkins states, is intended to “promote heightened regulatory compliance while also helping investment adviser representatives better serve their clients by remaining knowledgeable of current regulatory requirements and best practices.” 2022 IAR CE Read more about 2022 & 2023 Continuing Education Requirements for IARs[…]