December 11, 2019

December 10, 2019

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December 09, 2019

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FINRA Proposes Limitations on Serving as a Customer’s Beneficiary

The Financial Industry Regulatory Authority (FINRA) is requesting public comment on a proposed rule that generally would prohibit registered persons from serving as a customer’s beneficiary, executor or trustee, or holding a power of attorney or similar position for or on behalf of a customer. The proposed rule also would provide two exceptions from this general prohibition, including (1) instances in which the customer is a member of the registered person’s immediate family and (2) instances in which the member firm approves in advance the relationship. In addition, the proposed rule would require member firms to review and assess these relationships.

As noted by FINRA, the proposed rule is intended to address potential conflicts of interest.

The comment period for this proposal expires on January 10, 2020.

More information is available here.

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About this Author

James M. Brady, Katten Muchin Law Firm, Finance Attorney
Associate

James Brady concentrates his practice in financial services matters.

While in law school, James was an editor of the Michigan Journal of International Law. He also served as a judicial intern to the Honorable Stephen J. Markman of the Michigan Supreme Court. http://www.kattenlaw.com/James-Brady

312-902-5362
Michael T. Foley, Katten, Lawyer, Finance, FINRA, Chicago
Special Counsel

Michael Foley represents broker-dealers, investment advisers and other financial services industry participants with respect to a broad spectrum of legal and regulatory matters arising under the federal securities laws.

Michael has nearly 20 years of experience in private practice and in-house at both a large, full-service broker-dealer and at an online discount broker-dealer, advising broker-dealers and other financial institutions regarding compliance with the federal securities and commodities laws, and with the regulations of the US Securities and Exchange Commission, the US Commodity Futures Trading Commission and financial industry self-regulatory organizations. 

312-902-5452