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FINRA Releases Annual Exam Priorities Letter

FINRA released its annual Regulatory and Examination Priorities Letter identifying areas of FINRA focus for 2018.  FINRA announced a focus on fraud including insider trading, microcap pump-and-dump, Ponzi schemes and the resulting referrals to the SEC, even if the wrongdoing is outside of FINRA’s jurisdiction.  FINRA will also target supervision practices including the hiring and review of high-risk brokers, branch offices, and outside business activities.  New this year is a focus on cryptocurrency offerings and the role registered reps play in effecting transactions.  FINRA also highlights best execution, cybersecurity, anti-money laundering, and business continuity.  Consistent with prior years, FINRA will devote resources to customer protection and net capital, suitability, and liquidity risk.

OUR TAKE: Compli-pros should use the Priorities Letter as a checklist to review the Written Supervisory Procedures.  FINRA generally means what it says and addresses these topics during exams.

http://www.finra.org/industry/2018-regulatory-and-examination-priorities-letter