In January 2010, FINRA issued Regulatory Notice 10-06 in an attempt to provide guidance on the application of FINRA rules governing communications with the public to social media sites. The guidance did not provide much that was new. Largely, FINRA pointed out that the existing communication and record-keeping rules applied. Too bad that the site [...]
Tag Archives: FINRA
Twitter Fail and Compliance
FINRA has long regulated and limited the ability of broker/dealers to communicate with the public. One of their missions is to protect the investing public from unscrupulous securities brokers. Twitter is a communications tools and any messages posted to Twitter will need to be in compliance. It was inevitable that we would see a FINRA [...]
SEC Study on Enhancing Investment Adviser Examinations
Now that most private funds managers are required to register with SEC as investment advisers, the SEC is considering abandoning them to regulation by FINRA. The SEC released the much anticipated report, a 40-page “ Study on Enhancing Investment Adviser Examinations” mandated by Section 914 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. [...]
Disciplinary Actions Against Chief Compliance Officers
The Chief Compliance Officer should be a model for employee conduct. I don’t thing there is any better way to lead and educate than to set an example. Not all Chief Compliance Officers succeed in this role and some get subject to discipline. Here are some ways to get in trouble. Participation in Wrongful Conduct [...]
You know you’ve failed as a CCO when you get barred by FINRA
The Financial Industry Regulatory Authority permanently barred Tod Bretton, former chief compliance officer and head trader for Prestige Financial Center, Inc. “FINRA found that, from at least September 2006 through June 2009, Bretton, working from the firm’s New York office, engaged in a fraudulent trading scheme in which he took advantage of customers placing large [...]
FINRA Guidance on Private Placements
The Financial Industry Regulatory Authority released Regulatory Notice 10-22 reminding registered firms about their obligations regarding suitability, disclosures and other requirements for selling private placements to customers. A Broker-Dealer that recommends a security is under a duty to conduct a reasonable investigation concerning that security and the issuer’s representations about it. This is true regardless [...]
FINRA and Placement Agents
Will FINRA step in to prevent a ban on placement agents working with government investors? You may remember that last August, the SEC published a proposed rule that would create a prohibition on paying a third party, such as a placement agent, to solicit a government client on behalf of the investment adviser: IA-2910. The [...]
Implementing Compliance Practices for Social Media
I was in the audience for FINRA’s latest educational Program: Implementing Compliance Practices for Social Media. This program addressed implementation of new guidance that FINRA recently issued in Regulatory Notice 10-06, concerning social media. Resources and Supplementary Material (.pdf) Slide deck (.pdf) These are my notes, live from the program (& riddled with typos): Introduction [...]
Futures Trading and Social Networking
With this week’s release of FINRA’s guidance on social media sites for securities traders, I thought it would be interesting to look at how the futures trading regulatory body is dealing with the issues. It turns out that the National Futures Association recently amended its rules to address social media and released new interpretive notices [...]
FINRA Issues Guidance on Social Networking Sites
Securities firms and brokers have been looking for guidance on how they can use social networking sites. Actually most industries have been trying to figure out what they can and cannot do with these sites. The difference is that the FINRA limitations on communicating with the public make it very difficult to use the sites [...]
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