Member Supervisory Controls
It is not enough to establish and document a supervisory system. The procedures within the system must also be enforced. FINRA requires that each member establish a system of written supervisory controls to ensure that the supervisory system is functioning as it should.
Accordingly, each member firm must identify one or more principals who shall establish, maintain, and enforce this system of supervisory controls. This designated principal or compliance officer has the responsibility to test and verify the success of the member firm’s supervisory procedures and to amend or create additional procedures as needed.
Each year this designated principal must submit a report to the member firm’s senior management detailing th