The Financial Industry Regulatory Authority (FINRA) announced Thursday it is planning to issue proposals to enhance investor protection by enhancing controls on brokers with a history of misconduct, and the firms that employ them.
FINRA indicates that the forthcoming proposals will include enhanced disclosure on its BrokerChek system, heightened supervision of brokers that are appealing disciplinary matters, and revised guidelines for determining proficiency exemptions (to include factors such as disciplinary history, arbitration awards and settlements).
The U.S. self-regulatory organization also plans to issue a regulatory notice reinforcing and clarifying firms’ existing supervisory obligations concerning high-risk brokers that they employ.
“Built on extensive data and analyses, these programs are specifically designed to identify and address high-risk brokers, including through disciplinary actions, enhanced examinations, and ongoing surveillance,” FINRA says is a statement.
“These actions will build on FINRA’s extensive existing programs to address high-risk brokers and reflect our commitment to protect investors and promote public confidence in securities firms and markets. We are continuing to develop additional proposals in this area that will be brought to the board in the coming months,” adds Robert Cook, president and CEO of FINRA.