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- Sarah ten Siethoff is New Associate Director of SEC Investment Management Rulemaking Office
- Catherine Keating Appointed CEO of BNY Mellon Wealth Management
- Credit Suisse to Pay $47Mn to Resolve DOJ Asia Probe
- SEC Chair Clayton Goes 'Hat in Hand' Before Congress on 2019 Budget Request
- SEC's Opening Remarks to the Elder Justice Coordinating Council
- Massachusetts Jury Convicts CA Attorney of Securities Fraud
- Deutsche Bank Says 3 Senior Investment Bankers to Leave Firm
- World’s Biggest Hedge Fund Reportedly ‘Bearish On Financial Assets’
- SEC Fines Constant Contact, Popular Email Marketer, for Overstating Subscriber Numbers
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- Cryptocurrency Exchange Bitfinex Briefly Halts Trading After Cyber Attack
- SEC Names Valerie Szczepanik Senior Advisor for Digital Assets and Innovation
- SEC Modernizes Delivery of Fund Reports, Seeks Public Feedback on Improving Fund Disclosure
- NYSE Says SEC Plan to Limit Exchange Rebates Would Hurt Investors
- Deutsche Bank faces another challenge with Fed stress test
- Former JPMorgan Broker Files racial discrimination suit against company
- $3.3Mn Winning Bid for Lunch with Warren Buffett
- Julie Erhardt is SEC's New Acting Chief Risk Officer
- Chyhe Becker is SEC's New Acting Chief Economist, Acting Director of Economic and Risk Analysis Division
- Getting a Handle on Virtual Currencies - FINRA
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NEWSLETTERS & ALERTS
Rules & Regulations
FINRA Enhances CRD Reviews: Firms Save on Compliance Risks and Costs
by Howard Haykin
For the past several years, FINRA has been checking public financial records on an annual basis to ensure that financial disclosures in individual brokers’ CRD files are accurate. Beginning Monday, July 9, FINRA will conduct such reviews of public records when a Form U4 is submitted – and contact the applicant’s firm within 15 calendar days of the application if information may be missing or contains discrepancies.
What this means is that firms will no longer have to validate answers to financial disclosure questions on Form U4 when it hires a new registered rep – an obligation that firms have typically fulfilled by hiring vendors to perform public record checks in search of undisclosed personal bankruptcies, judgments and liens.
FINRA estimates that firms will save a combined $1.5 million to $3 million per year by avoiding search fees charged by vendors and fees assessed by FINRA for late filings. And, besides enabling firms to more readily accomplish their reporting obligations, FINRA expects that data collected in CRD – and made available through BrokerCheck – will be more current and reliable.
WORD OF CAUTION. While firms can rely on the financial public record reviews performed by FINRA to satisfy the applicable part of FINRA Rule 3110(e) (Responsibility of Member to Investigate Applicants for Registration), FINRA’s review does not relieve firms or registered reps of their duty to keep their records up to date. Firms should review FINRA InfoNote - 5/18/18 (Enhancements to FINRA’s Disclosure Review Process Relating to Public Financial Records), for additional information.