FINRA Proposes Further Restrictions on Firms with Bad History

FINRA proposed rule changes that would permit certain conditions or restrictions to be imposed on broker-dealers that have a "significant history" of misconduct or that hired associated persons with such a history.

The proposed rule changes would allow restrictions to be imposed on firms during the period of an appeal or review of disciplinary decisions by the National Adjudicatory Council, including requiring the establishment of heightened supervision plans. The proposed amendments would also:

• provide for expedited proceedings;

• require heightened supervision when a statutory disqualification eligibility request is under review by FINRA;

• allow FINRA to disclose that a firm is subject to the "Taping Rule" through BrokerCheck; and
• impose additional obligations on firms hiring persons who have a significant history of misconduct.