January 29, 2023

Volume XIII, Number 29

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January 27, 2023

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Financial Industry Regulatory Authority "FINRA" Requests Comment on Proposed Rule Requiring Disclosure of Conflicts of Interest in Recruitment Incentives

Member firms often offer financial incentives when recruiting registered representatives. The Financial Industry Regulatory Authority has stated that it believes such financial incentives raise conflicts of interest that often are not disclosed when registered representatives ask their former customers to transfer to their new firm. Thus, FINRA is seeking comment on a proposed rule that would require a recruiting member firm to make detailed disclosure of the recruitment incentives offered to a registered representative who has been recruited. Comments must be submitted to FINRA by March 5.

FINRA Regulatory Notice 13-02 is available here.

©2023 Katten Muchin Rosenman LLPNational Law Review, Volume III, Number 14
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