Tag: Rule 2010

Exam Alert: FINRA requires firms to file SSOI supplement to FOCUS Reports

FINRA Rule 4524, which became effective on February 28, 2012, allows FINRA to require member firms to file supplemental reports to their Financial and Operational Combined Uniform Single (FOCUS) Report. Continue reading

FINRA Rule 4524, which became effective on February 28, 2012, allows FINRA to require member firms to file supplemental reports to their Financial and Operational Combined Uniform Single (FOCUS) Report.  FINRA will require firms to file the Supplemental Statement of Income (SSOI), which provides a more detailed breakdown of certain financials than the Statement of Income page of the FOCUS Report.  Firms that derive more than 10% of their revenues from unregistered offerings will be required to complete an Operational Page that requires additional information about each unregistered offering.  Firms will have to file the SSOI within 20 business days of the end of each calendar quarter, and the due date for the first required SSOI is October 26, 2012.

Source: FINRA Regulatory Notice 12-11

This alert applies to the Series 24, the Series 26 and the Series 99.

Exam Alert: FINRA recommends heightened supervision for complex products

On January 17, 2012, FINRA highlighted the need for firms to have adequate supervisory and compliance programs in place in order for registered representatives to recommend complex products. FINRA identified several characteristics that may cause a product to be considered “complex,” such as embedded derivatives or contingencies. The notice states that agents should determine suitability, consider the customer’s financial sophistication, discuss the products with the customer, and consider alternative investments that could meet the customer’s goals. The firm should also review the performance of the products and train the agents about the products. Continue reading

On January 17, 2012, FINRA highlighted the need for firms to have adequate supervisory and compliance programs in place in order for registered representatives to recommend complex products.  FINRA identified several characteristics that may cause a product to be considered “complex,” such as embedded derivatives or contingencies.  The notice states that agents should determine suitability, consider the customer’s financial sophistication, discuss the products with the customer, and consider alternative investments that could meet the customer’s goals.  The firm should also review the performance of the products and train the agents about the products.

Source: FINRA Regulatory Notice 12-03

This alert applies to the Series 6, Series 7, Series 24, Series 26, Series 55, Series 62, Series 79, Series 82, Series 99, Series 63, Series 65, and Series 66.