Series 26: Capital Compliance Rule

Taken from our Series 26 Online Guide

Capital Compliance Rule

FINRA’s capital compliance rule is intended to guard against and prevent the failure of a member firm to maintain its net capital requirements. Among its provisions, the rule allows FINRA to raise a firm’s minimum capital requirements, suspend its business operations, and limit its ability to withdraw capital.

Authority to increase capital requirements. When necessary for the protection of investors, FINRA may prescribe greater net capital or net worth requirements with respect to any carrying or clearing firms than those otherwise applicable. FINRA may demand a more stringent method for their computation, or a restoration or increase of a firm’

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