Federal Register: FINRA Proposes Rule Changes to Conform to Reg BI
A FINRA proposal to modify its suitability requirements and rules governing non-cash compensation to conform to the stricter standards of Regulation Best Interest ("Reg BI") was published in the Federal Register. Comments must be submitted by April 15, 2020.
As previously covered, the proposed rule changes would amend the FINRA and Capital Acquisition Broker (or "CAB") suitability rules to:
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"state that the rules do not apply to recommendations subject to" Reg BI, and "remove the element of control from the quantitative suitability obligation"; and
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"conform the rules governing non-cash compensation to Reg BI's limitations on sales contests, sales quotas, bonuses and non-cash compensation."
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