Broker-Dealers Take Notice: FINRA Publishes 2017 Annual Exam Priorities Letter

 

FINRA has published its annual examination priorities letter for 2017 and broker-dealers should take note of the 22 topics. These priorities can be used to help you understand their focus and give you guidance on how to prioritize your efforts to maintain a compliant firm. So take a look at your risk assessments, policies and procedures, supervisory systems, surveillance tools, testing calendars, and training plans to make sure you are confident that you are ready.

In the coming weeks, Oyster will be providing commentary on some of the hot button issues on the list which includes:

  • High Risk and Recidivist Reps
  • Senior Investors
  • Product Suitability and Concentration with specifically mentioned topics of:

Type of product concentration
Complex exchange-traded products
Structured retail products
Leveraged and inverse ETFs
Non-traded REITs
Unlisted BDCs

  • Excessive and Short-term Trading of Long-term Products
  • Outside Business Activities and Private Securities Transactions
  • Social Media and Electronic Communications Retention and Supervision
  • Liquidity Risk
  • Financial Risk Management
  • Credit Risk Policies, Procedures and Risk Limit Determinations (Rule 4210)
  • Cybersecurity
  • Supervisory Controls Testing
  • Customer Protection/Segregation of Client Assets
  • Regulation SHO Close Out and Easy to Borrow
  • Anti-Money Laundering and Suspicious Activity Monitoring
  • Municipal Advisor Registration
  • Market Manipulation
  • Best Execution
  • Audit Trail Reporting Early Remediation Initiative and Expansion
  • Tick Size Pilot
  • Market Access Rule
  • Trading Examinations
  • Fixed Income Securities Surveillance Program

In the interim, if you have any questions or concerns about any of these topics, please contact us and we will follow-up promptly. Our consultants are experts in these areas and have the experience and perspective gained from working with hundreds of clients to help you efficiently and effectively run your firm. They have sat in your seat and faced the same obstacles and regulatory scrutiny. We can also provide you with compliance automation through our Oyster Solutions platform by integrating risk assessments, policies and procedures and testing programs that are aligned to how you do business.

For more information or to schedule a demo of Oyster Solutions, please complete our contact form or call Oyster Consulting at (804) 965-5400, and one of our associates will be happy to assist you.

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