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  1. 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

  2. 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

  3. 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

  4. 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

  5. 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

  6. 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

  7. NASAA Comment Request 9.22 - Request for Public Comment on Proposed Revisions to the Uniform Application to Register Securities

    The Corporation Finance Section Committee and the Business Organizations and Accounting Project Group (“Project Group”) of the North American Securities Administrators Association, Inc. seek public comment on proposed revisions to the Uniform Application to Register Securities. The Project Group is proposing to amend the Form U-1 to require that preliminary proxy statements, definitive proxy statements, definitive additional materials, and soliciting material be filed with NASAA members within two business days after filing such materials with the SEC.

    9/22/2022

  8. Cboe RN 22-013 Requirement to Provide Notification to the Exchange of Disciplinary Action

    Cboe Options, C2 Options, BZX Options and EDGX Options are issuing this regulatory circular to inform Trading Permit Holders and Members (collectively, “Members”) of the process a Member must follow to notify the Exchanges of disciplinary actions by other organizations against the Member or its associated persons as required by Cboe Options and C2 Options Rule 8.81 and BZX Options and EDGX Options Rules 18.5.

    9/8/2022

  9. MSRB Regulatory Notice 2022-09 MSRB Amends Rule G-3 on Dealer Continuing Education Program Requirements

    The MSRB filed with the SEC a proposed rule change to amend Rule G-3 to align continuing education (CE) obligations under MSRB Rule G-3 for brokers, dealers, and municipal securities dealers with commission approved amendments to the FINRA's CE rules, and facilitate the recommendations of the Securities Industry/Regulatory Council on Continuing Education (CE Council) that enhance CE requirements for municipal securities industry professionals. The MSRB proposed rule change does not modify continuing education obligations under Rule G-3 for municipal advisors. The proposed rule change was filed for immediate effectiveness.

    8/30/2022

  10. SEC Release 34-95620 Whistleblower Program Rules

    The SEC is adopting amendments to the Commission’s rules implementing its whistleblower program. Section 21F of the Securities Exchange Act of 1934 (“Exchange Act”) and the Commission’s implementing rules provide that the Commission shall pay an award to eligible whistleblowers who voluntarily provide the Commission with original information about a violation of the federal securities laws that leads to the successful enforcement of a covered judicial or administrative action or a non-SEC related action. The amendments: expand the scope of related actions eligible for an award under the Commission’s whistleblower program; clarify that the Commission may use its statutory authority under Section 21F to consider the dollar amount of a potential award to increase an award but provide that the Commission will not use any statutory authority it might have to decrease the amount of an award; and make several conforming changes and technical corrections.

    8/26/2022

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