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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
- SocGen Agrees to Pay $1.3 Billion to End Libya, Libor Probes
- 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: How Firms ‘Should’ Communicate with Customers When RRs Depart
by Howard Haykin
FINRA: ‘Guidance on Customer Communications Related to Departing Registered Representatives’. When dealing with the departure of a registered representative (“RR”), FINRA contends that customers should not experience an interruption in service and should be able to make timely and informed choices about where to maintain their assets.
To that end, FINRA member firms should communicate clearly, and without obfuscation, to affected customers about how their accounts will continue to be serviced at the current firm, where it would be serviced by a newly assigned RR or a different RR. Alternatively, customers should be advised that their assets could be transferred to another firm.
FINRA further notes says that member firms should also provide customers with timely and complete answers, if known, when the customer asks questions about a departing RR. This includes how they might contact the departing RR, provided that the RR consented to disclosure of his or her contact information.
SINGER: ‘FINRA Notice to Members 19-10 Should Have Said What it Meant’. Bill Singer might have retitled his blog, “Don’t Get Me Started.” From the get-go, he wasted no time in venting his ‘disgust, frustration, and outrage’ over FINRA's persistent use of the term, "should," when more appropriate terms, "must" or "shall," would have established what is needed most - hard and fast requirements.
Rather than state in specific terms what member firms must do when RRs depart, Mr. Singer says that FINRA opted to state what member firms should do. In doing so, FINRA has effectively left it up to firms to use their own discretion in how best to deal with affected customers. And by failing to be definitive, he says, FINRA has perpetuated a long-standing industry battle that pits RRs against their former firms in deciding ‘who owns the customer’ and ‘what’s best for the customer’ – when, in truth, “the customer owns himself or herself; and it is up to the customer whether to stay or go.” As such, Mr. Singer says that FINRA NtM 19-10 comes across as a ‘colossal waste’ and "an embarrassment."