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FINRA Provides Member Firms with New Reg BI and Form CRS Resources

On October 8, the Financial Industry Regulatory Authority (FINRA) announced the availability of new resources to assist member forms to comply with the Securities Exchange Commission’s Regulation Best Interest (Reg BI) and Form CRS by the June 30, 2020 compliance deadline. Reg BI establishes a “best interest” standard of conduct for broker-dealers and associated persons when making recommendations to a retail customer in connection with a securities transaction or investment strategy involving securities. In addition to the Reg BI requirements, the SEC also adopted a new rule to require broker-dealers and investment advisers to provide retail investors with a brief relationship summary known as the Form CRS.

Among other resources, FINRA is providing a Reg BI and Form CRS Checklist to help member firms assess and implement necessary changes to their policies, procedures and compliance programs. This checklist outlines (1) the major requirements of the rules, and (2) key differences between FINRA rules and Reg BI and Form CRS.

In addition to providing the aforementioned, FINRA will be hosting a series of upcoming events intended to further discussions related to Reg BI.

A description of the resources and upcoming events is available here.

©2020 Katten Muchin Rosenman LLP


About this Author

Susan Light, Katten Law Firm, Finance Law Attorney, New York

Susan Light focuses her practice on financial services regulatory matters. She counsels broker-dealers, hedge funds, investment banks and financial services clients on enforcement issues involving the Securities and Exchange Commission (SEC), Financial Industry Regulatory Authority (FINRA), other self-regulatory organizations (SROs) and state and federal regulatory authorities. She has particular experience related to sales practice issues, financial and operational issues, anti-money laundering, crowdfunding, cybersecurity, and cryptocurrencies.

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.