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Amended FINRA Registration Rules To Take Effect October 1

Amended Financial Industry Regulatory Authority registration, qualification and continuing education rules will become effective on October 1. The amended rules, which the Securities and Exchange Commission approved on October 13, 2017, will consolidate and replace the National Association of Securities Dealers, Incorporated New York Stock Exchange and existing FINRA registration rules.

Among other things, the new rules:

  • Require member firms to designate both a principal financial officer (who has primary responsibility for financial filings and related books and records) and a principal operations officer (who has primary responsibility for the day-to-day operations of the business);
  • Allow firms to permissively register, as a principal or representative, any associated person of the firm;
  • Establish three new principal registration categories (compliance officer, investment banking principal and private securities offerings principal); and
  • Provide a registration waiver program that allows individuals, who terminate their registrations with a member firm in order to go to work for a financial services industry affiliate of such a firm, to obtain a waiver of their requalification requirements upon reapplying with FINRA for registration, subject to certain conditions.

FINRA also has restructured the representative-level qualification examination such that all representative-level applicants will take a general knowledge examination (called the Securities Industry Essentials or SIE) and a tailored, specialized knowledge examination (a revised representative-level qualification examination) for their particular registered role.

More information about the amended rules is available here.

FINRA Regulatory Notice 17-30 is available here.

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About this Author

Kevin M. Foley, Finance Lawyer, Katten Llaw Firm
Partner

Kevin M. Foley has extensive experience in commodities law and advises a wide range of clients, both in the United States and abroad, on compliance with the Commodity Exchange Act and the rules of the Commodity Futures Trading Commission (CFTC) affecting traditional exchange-traded products, as well as the over-the-counter markets involving swaps and other derivative instruments. His clients include futures commission merchants, derivatives clearing organizations, designated contract markets, foreign boards of trade and an industry trade association.

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312-902-5372
Associate

Timothy Kertland concentrates his practice on transactional, corporate and regulatory aspects of financial services matters. Timothy is able to provide legal services to a wide variety of clients including proprietary trading firms, hedge funds, broker-dealers, registered investment advisers, and commodity trading advisers.

While in law school, Timothy served as an editor of the Virginia Tax Review. As a first-year law student, he represented the University of Virginia School of Law at the National Transactional LawMeets Competition.

312-902-5343