The U.S. Financial Industry Regulatory Authority is proposing to expand its broker database to make the records of final regulatory actions against brokers permanently available to the public, regardless of whether they continue to be employed in the securities industry, FINRA said Monday.

Under current rules, a broker’s record generally becomes unavailable to the public two years after they leave the securities industry and is therefore no longer under FINRA’s jurisdiction.

“It has never been more critical for investors to research the backgrounds of the people who approach them with investment proposals,” said Richard Ketchum, FINRA chairman and CEO. “Individuals previously barred by FINRA and other securities regulators have surfaced in a number of recent frauds responsible for millions lost by unsuspecting investors. Investors should be able to check if the financial professional they’re dealing with has been the subject of a disciplinary action by regulators.”

FINRA filed its rule proposal to expand its BrokerCheck service with the Securities and Exchange Commission late last week. The SEC will publish the proposal and solicit public comment in the near future.

IE