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FINRA Proposes Rule Change Related to the Content of the Securities Industry Essentials Examination

On January 12, the Financial Industry Regulatory Authority (FINRA) filed with the Securities and Exchange Commission a proposed rule change outlining the content and selection specifications for FINRA’s new general knowledge examination, the Securities Industry Essentials Examination (SIE) (For additional information related to the SIE, please see the July 14, 2017 edition of the Corporate & Financial Weekly Digest.) The rule change proposes that the SIE be divided into the following four sections:

  1. Knowledge of Capital;
  2. Understanding Products and their Risks;
  3. Understanding Trading, Customer Accounts and Prohibited Activities; and
  4. Overview of the Regulatory Framework.

FINRA believes that the proposed outline streamlines the general securities knowledge that is currently covered on the representative-level examinations. Pursuant to Section 19(b)(3) of the Securities Exchange Act of 1934, as amended, and Rule 19b-4 thereunder, the rule change was effective upon filing. The implementation date for the SIE will be October 1, 2018, which coincides with the implementation of the restructured representative-level examination program.

The text of the rule change is available here.

©2019 Katten Muchin Rosenman LLP


About this Author

Kevin M. Foley, Finance Lawyer, Katten Llaw Firm

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.


Stanley V. Polit, Katten Muchin, Financial Services lawyer, Corporate Regulatory Matters Attorney

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

Prior to joining Katten, Stan served as a council member for a national crisis management firm, where he specialized in crisis communication and merged media strategies. He has lectured extensively and conducted trainings related to these topics at numerous national and international conferences, including the National Communication Association's National Convention, the International Crisis and Risk Communication Conference and the Disaster Recovery Journal's World Business Continuity Conference.