FINRA Creates Online “Information Hub” for Reg BI
The Financial Industry Regulatory Authority (FINRA) has created a Regulation Best Interest webpage to help broker-dealers comply with the Securities and Exchange Commission’s (SEC) rule, and is urging broker-dealers to submit questions to the securities regulator about Reg BI and the agency’s customer relationship summary, Form CRS, to IABDQuestions@sec.gov.
FINRA also released Regulatory Notice 19-29, which serves to remind member firms of the SEC’s adoption of a best interest standard of conduct for broker dealers and a relationship summary (For CRS) delivery obligation.
In the Notice, FINRA states that it will produce written and online content to assist firms, as appropriate, and that the broker-dealer self-regulator plans to hold in-person meetings and workshops to assist firms with their implementation efforts. FINRA will announce these initiatives through various communication channels, including website announcements and emails to firms.
A staff committee with representatives from the SEC’s Division of Investment Management, Division of Trading and Markets, Division of Economic and Risk Analysis, Office of Compliance Inspections and Examinations and Office of the General Counsel was set up to assist firms with planning for implementation of the new rules.
The Advisers Act releases were effective on July 12, 2019. Firms must comply with Reg BI and Form CRS by June 30, 2020.
See the following SEC resources for details:
- SEC Release for Regulation Best Interest: The Broker-Dealer Standard of Conduct
- SEC Release for Form CRS Relationship Summary; Amendments to Form ADV
- Form CRS Instructions
- Commission Interpretation Regarding Standard of Conduct for Investment Advisers
- Commission Interpretation Regarding the Solely Incidental Prong of the Broker-Dealer Exclusion from the Definition of Investment Adviser
FINRA’s Reg BI webpage also states that FINRA will review its “rules to see whether changes are needed to align FINRA rules with the SEC’s rulemaking,” and that any proposed changes will be filed with the SEC for public comment and available on FINRA’s website.
To read the complete Regulatory Notice, click here.