FINRA’s Reg BI Conference – What You Need to Know

UpdateWith just over six months remaining until the implementation date of Reg BI, we are seeing regulators provide additional guidance to help firms to meet the requirements of the rule, and regulatory expectations.  This week, FINRA hosted its Reg BI Conference in Washington, DC and Oyster’s consultants attended to receive the most up to date guidance directly from the SEC and FINRA staff.  The program included Senior SEC and FINRA Staff, including Division Directors and Counsel, as well as representatives from large and small broker-dealers.

Chip Jones, FINRA’s Senior Vice President for Member Regulation and Education, opened the conference by stating that Reg BI is the most profound change to the securities industry in decades.

Some of the conference highlights to consider:

  • A Senior SEC panelist stated no extension beyond the June 30, 2020 effective date is under consideration,
  • Broker-dealer examinations commencing after January 1, 2020 will include requests for information concerning the progress firms are making towards the implementation of Reg BI to gauge industry preparedness,
  • Examinations commencing after July 1, 2020 will include Reg BI issues with the expectation of meaningful, good faith efforts expended to comply with the requirements of the Regulation,
  • Regulators are expecting firms to have developed procedures and training to drive compliance with all aspects of Reg BI, and
  • A significant amount of discussion was devoted to delivery of the Reg BI information and Form CRS.

In our discussion with the regulators following the conference, they expressed concern about the number of firms that haven’t started, and the amount of work required to achieve compliance.

Oyster has assisted a number of broker-dealers and registered investment advisors with understanding their obligations under Reg BI and Form CRS. Additional guidance from regulators is expected. If you if haven’t started or are having challenges figuring out the best approach to achieving compliance at your firm, Oyster has several resources available to help you succeed.  Oyster provides free resources such as podcasts and blogs, as well a team of consultants and software to help you organize and automate your compliance program.  Oyster Consulting has the knowledge and experience to support your efforts to achieve compliance.  To receive assistance with the implementation of your Reg BI compliance program, or assistance in understand the impact of these rules, please give us a call at (804) 965-5400 and a Relationship Managers will be glad to connect you with an Oyster expert.


About the Author: Patrick M. Dennis has been involved in the securities industry for over 30 years. Previously, Patrick was a Senior Vice President and Assistant General Counsel to Wachovia Securities, LLC (now Wells Fargo Advisors), or its predecessors. Patrick moved to Wells Fargo in 1998, where he was in charge of all litigation and regulatory matters affecting the retail brokerage firm. He managed securities litigation and arbitration matters until 2003 when he moved into a Senior Regulatory Counsel position. In that capacity, he handled a number of high-profile regulatory matters for the firm including, mutual fund breakpoints, mutual fund market timing, inactive fee-based accounts and closed end funds. Patrick also served as Senior Regulatory Counsel to Wachovia’s Investment Advisory line of business.