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FINRA Proposes Amendments to Rules on Customer Statements

FINRA proposed amendments to harmonize FINRA Rule 2231 ("Customer Account Statements") with Temporary Dual FINRA-NYSE Rule 409T ("Statements of Accounts to Customers") and Temporary Dual FINRA-NYSE Rule Interpretation 409T. The proposal would add new supplementary materials to FINRA Rule 2231 and incorporate "without substantive change" existing provisions of Temporary Dual FINRA-NYSE Rule Interpretation 409T.

FINRA proposed to add to Rule 2231:

  • Supplementary Material .01, which would remind firms of their obligations under FINRA Rule 4311 ("Carrying Agreements");

  • Supplementary Material .02, which would address the transmission of customer account statements to a third party;

  • Supplementary Material .03, which would expressly allow electronic media use as a means to satisfy delivery obligations; and

  • Supplementary Material .04, which would permit a firm to hold customer mail pursuant to FINRA Rule 3150 ("Holding of Customer Mail").

In addition, FINRA proposed supplementary materials that would transfer from Temporary Dual FINRA-NYSE Rule Interpretation 409T requirements regarding: (i) the information that must be disclosed on the front of an account statement; (ii) the separation of externally held assets on account statements; (iii) the use of logos and trademarks; and (iv) summary statements.

FINRA also proposed the deletion of Temporary Dual FINRA-NYSE Rule 409T and the Temporary Dual FINRA-NYSE Rule Interpretation 409T.

Comments on the proposed harmonization should be submitted within 21 days of its publication in the Federal Register.

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