Don’t Be on the Naughty List – FINRA’s Equity & Debt Research Rule Changes Taking Effect Soon

FINRA is giving its members a holiday gift this year – New Equity and Debt Research Rules will take effect on December 24, 2015, and firms must adjust their policies and procedures to reflect the changes or risk being on the naughty list.

Member firms should review their policies, procedures, processes and controls, and determine what changes will be necessary to remain compliant under these new rules.

Both rules require firms to have policies and procedures in place surrounding:

  1. Disclosures, particularly conflicts of interest;
  2. Information barriers between Analysts and supervisors, including investment banking and sales and training personnel;
  3. Blackout Periods for Analysts making public appearances or participating in “other marketing” on behalf of an issuer related to an investment banking services transaction; the Debt Research Rule does not require Blackout Periods
  4. Prohibition of Analysts and Supervisors of Analysts benefiting from knowledge of the timing or content of the research report;
  5. Distribution of third-party research; and
  6. Prohibition of Retaliation Against Analysts

To view the amended Equity Research Rule click here

To view the new Debt Research Rule, click here

Oyster Consulting’s Compliance and Regulatory team includes former FINRA, SEC and State Regulators, Chief Compliance Officers, General Counsels, AML Officers, Supervisory Principals, and Auditors. Our deep experience enables us to efficiently and effectively review your firm’s policies and procedures, test your firm’s supervisory controls procedures, document the review, and work with your firm’s management to recommend ways to remediate any gaps and improve your firm’s control environment.

For more information on how Oyster Consulting can assist your firm with its regulatory compliance needs, explore the services on our website or give us a call at 804.965.5400 and one of our associates will be happy to help you.