FINRA Rule 4150: Assuming the Liabilities of Others
A broker-dealer, especially one that is not a member of the NYSE, may fail to recognize that FINRA Rule 4150(a) requires prior written notice to be given to FINRA whenever it guarantees, endorses, or assumes, directly or indirectly, the obligations or liabilities of another person (for example, an affiliated company). In Regulatory Notice 11-26, FINRA explained that this requirement, which was based on an NYSE Rule, would be new to non-NYSE members because the NASD Rules had no corresponding provision. We encourage broker-dealers to take a closer look at FINRA Rule 4150 and Read More…