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  1. FINRA Regulatory Notice 23-06: FINRA Shares Effective Practices to Address Risks of Fraudulent Transfers of Accounts Through ACATS

    FINRA’s regulatory programs—through examinations and investigations, review of customer complaints and member firm engagement—have identified increased instances of ACATS fraud. Through recent industry engagement, FINRA has gained further insights from member firms and other industry representatives about their approaches to detect and mitigate the risk of ACATS fraud. This Notice provides an overview of some indicators of ACATS fraud and the practices some firms apply to address it.

    3/28/2023

  2. FINRA Regulatory Notice 23-05: FINRA Revises the Research Analyst (Series 86/87) Exam Program

    FINRA periodically reviews the content of qualification exams to ensure each exam remains current and appropriately tailored to the qualifications and subject matter being tested. Based on this review process, FINRA has revised the Research Analyst (Series 86/87) exam program to incorporate the functions and associated tasks a Research Analyst currently performs; reflect the laws, rules, and regulations most relevant to these functions and associated tasks; reduce the number of scored multiple-choice questions on the Series 86 exam; and update the content outline to reflect these revisions.

    3/27/2023

  3. FINRA Information Notice 3.15.23: FINRA Opens a Second Enrollment Period for the Maintaining Qualifications Program

    FINRA has amended Rule 1240.01 (Eligibility of Other Persons to Participate in the Continuing Education Program Specified in Paragraph (c) of the Rule) to provide eligible individuals another opportunity to participate in the Maintaining Qualifications Program (MQP). This new enrollment period begins March 15, 2023 and will end on December 31, 2023.

    3/15/2023

  4. FINRA Regulatory Notice 23-02 FINRA Amends FINRA Rule 2231

    FINRA has adopted amendments to Rule 2231 (Customer Account Statements) to add eight new supplementary materials pertaining to: compliance with Rule 4311 (Carrying Agreements); the transmission of customer account statements to other persons or entities; the use of electronic media to satisfy delivery obligations; compliance with Rule 3150 (Holding of Customer Mail); the information disclosed on customer account statements; assets externally held; the use of logos and trademarks, etc.; and the use of summary statements. Several of these new supplementary materials are derived largely from Temporary Dual FINRA-NYSE Rule 409T (Statements of Accounts to Customers) and Temporary Dual FINRA-NYSE Rule Interpretation 409T (together, the NYSE provisions). These changes become effective on January 1, 2024.

    1/18/2023

  5. FINRA Regulatory Notice 22-31 FINRA Shares Practices for Obtaining Customers’ Trusted Contacts

    Member firms are required to make reasonable efforts to obtain the name of and contact information for a trusted contact for a noninstitutional customer’s account. This Notice summarizes member firms’ regulatory obligations, discusses the benefits of trusted contacts in administering customers’ accounts, highlights customer education resources and shares effective practices member firms use. This Notice does not create new legal or regulatory requirements or new interpretations of existing requirements, nor does it relieve firms of any existing obligations under federal securities laws and regulations. Member firms may consider the information in this Notice in developing new, or modifying existing, practices that are reasonably designed to achieve compliance with relevant regulatory obligations based on the member firm’s size and business model.

    12/15/2022

  6. FINRA Regulatory Notice 22-29 FINRA Alerts Firms to Increased Ransomware Risks

    FINRA has received reports about increasing numbers and sophistication of ransomware incidents. Ransomware typically involves bad actors gaining unauthorized access to firm systems and encrypting or otherwise accessing sensitive firm data or customer information, then holding that hijacked data for ransom. Some ransomware attacks have become significant threats that include theft of data and bad actors’ ongoing network access. Ransomware attacks have proliferated due to, in part, increased use of technology and continued adoption of cryptocurrencies, which bad actors use to hide their identities when collecting ransom payments. Further, Ransomware-as-a-Service (RaaS) models, where bad actors purchase attack services on the dark web1, have helped execute attacks on a much larger scale and make attacks available to less technologically savvy bad actors.

    12/14/2022

  7. MSRB Regulatory Notice 2022-14 MSRB Amends Rule A-12, on Registration, and Provides Accompanying Form A-12 Changes

    The Municipal Securities Rulemaking Board (MSRB) filed with the Securities and Exchange Commission (SEC)1 a proposed rule change to amend Rule A-12, on registration, that would, among other things, extend the time period to January 31 of each year for brokers, dealers and municipal securities dealers (collectively, “dealers”) and municipal advisors (together with dealers, “regulated entities” or “registrants”) to annually affirm the information on Form A-12, the MSRB’s consolidated electronic registration form. In addition, the proposed rule change requires the primary regulatory contact of a municipal advisor firm to be duly qualified as a municipal advisor principal by having taken and passed the Municipal Advisor Principal Qualification Examination (Series 54). Accompanying amendments to Form A-12 are also included in the proposed rule change to improve the usability of the registration form. The proposed rule change was filed for immediate effectiveness, and becomes operative on January 1, 2023, the first day of the 2023 Form A-12 annual affirmation period.

    12/13/2022

  8. SEC Release 34-96034 Electronic Recordkeeping Requirements for Broker-Dealers, Security-Based Swap Dealers, and Major Security-Based Swap Participants

    The Securities and Exchange Commission is adopting amendments to the recordkeeping rules applicable to broker-dealers, security-based swap dealers, and major security-based swap participants. The amendments modify requirements regarding the maintenance and preservation of electronic records, the use of third-party recordkeeping services to hold records, and the prompt production of records.

    10/12/2022

  9. FINRA Regulatory Notice 22-21 - FINRA Alerts Firms to Recent Trend in Fraudulent Transfers of Accounts Through ACATS

    FINRA alerts member firms to a rising trend in the fraudulent transfer of customer accounts through the Automated Customer Account Transfer Service, an automated system administered by the National Securities Clearing Corporation, that facilitates the transfer of customer account assets from one firm to another.

    10/6/2022

  10. MEMX Regulatory Notice 22-07 Updated Clearly Erroneous Execution Rules

    MEMX LLC, in coordination with all U.S. equities exchanges, has updated the harmonized clearly erroneous execution (“CEE”) rule as outlined below and the updated rule is now effective. Under the revised CEE rule, CEE reviews have been largely eliminated during Regular Trading Hours when Limit Up-Limit Down Price Bands are in effect, except in limited circumstances.

    10/3/2022

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