Summary of selected FINRA regulatory notices, January‐February 2011

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 January and February 2011.

Design/methodology/approach

The paper provides excerpts from FINRA Regulatory Notice 11‐03, January 2011, Order Audit Trail System (OATS): FINRA Expands the Order Audit Trail System to All NMS Stocks; Notice 11‐06, February 2011, Reporting Requirements: SEC Approves Consolidated FINRA Rule Governing Reporting Requirements; and Notice 11‐07, February 2011, Sanction Guidelines: FINRA Revises the Sanction Guidelines.

Findings

Regulatory Notice 11‐03: Effective July 11, 2011, FINRA will begin expanding, in three phases, the order recording and reporting obligations in the OATS Rules to include orders in all NMS stocks, in addition to OTC equity securities. Notice 11‐06: The SEC approved FINRA's proposal to adopt a rule governing reporting requirements for the consolidated FINRA rulebook. The rule requires member firms to: report to FINRA certain specified events and quarterly statistical and summary information regarding written customer complaints; and file with FINRA copies of certain criminal actions, civil complaints and arbitration claims. Notice 11‐07: Advises FINRA firms of modifications to the FINRA Sanction Guidelines, which reflect the experience of FINRA's Departments of Market Regulation and Enforcement in settling and litigating cases, and incorporate the teachings of federal appellate court and SEC precedent in recent FINRA disciplinary cases.

Originality/value

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

Citation

Davis, H.A. (2011), "Summary of selected FINRA regulatory notices, January‐February 2011", Journal of Investment Compliance, Vol. 12 No. 2, pp. 89-100. https://doi.org/10.1108/15285811111142955