Summary of selected FINRA regulatory notices and disciplinary actions September‐November 2009

Abstract

Purpose

The purpose of this summary is to provide excerpts of selected Financial Industry Regulatory Authority (FINRA) regulatory notices and disciplinary actions issued in September, October, and November 2009 and a sample of disciplinary actions during that period.

Design/methodology/approach

The paper provides excerpts from FINRA Regulatory Notice 09‐57, September 2009, Trade Reporting and Compliance Engine (TRACE); Regulatory Notice 09‐58, October 2009, Best Execution and Interpositioning; and Regulatory Notice 09‐66, November 2009, FINRA BrokerCheck. It also summarizes three disciplinary actions.

Findings

(09‐57) Effective March 1, 2010, firms must begin reporting transactions in Agency Debt Securities and primary market transactions and otherwise comply with all other requirements in the TRACE Rules, as amended, and amended FINRA Rule 7730. (09‐58) NASD Rule 2320(a) requires firms and their associated persons to use reasonable diligence to ascertain the best market for a security when handling transactions for or with a customer or a customer of another broker‐dealer. The amendments delete the requirement that, if a firm interposes a third party, the total costs and proceeds of the transaction must be better than the prevailing market and replace it with a specific obligation to apply the factors enumerated in Rule 2320(a) when a firm interjects a third party between the firm and the best available market. (09‐66) The primary purpose of BrokerCheck is to help investors make informed choices about the individuals and firms with which they do business.

Originality/value

These are direct excerpts designed to provide a useful digest for the reader and an indication of regulatory trends. The FINRA staff are aware of this summary but have neither reviewed nor edited it. For further details as well as other useful information, the reader should visit www.finra.org

Citation

Davis, H.A. (2010), "Summary of selected FINRA regulatory notices and disciplinary actions September‐November 2009", Journal of Investment Compliance, Vol. 11 No. 1, pp. 71-81. https://doi.org/10.1108/15285811011030239