A broker-dealer and one of its supervisors agreed to settle FINRA charges for allegedly failing to implement an adequate supervisory system to comply with FINRA's suitability rule. The failure allowed two registered representatives to recommend "excessive and unsuitable trades" in several customer accounts. According to the Letter of Acceptance, Waiver and Consent, Buckman, Buckman & Reid, Inc. ("BBR") and one of its supervisors failed to (i) identify that a registered representative had conducted "frequent and short-term trading of Unit Investment Trusts and other long-term investments with

An CFTC final rule allowing exceptions from the requirement that "covered persons" ( i.e., futures commission merchants, retail foreign exchange dealers, CTAs, CPOs, introducing brokers, major swap participants and swap dealers) send customers annual privacy notices was published in the Federal Register. (See here for previous coverage). The final rule will become effective on May 28, 2019.

FINRA proposed updating its Manual to reflect the new FINRA subsidiary, FINRA CAT LLC, an entity designed to further FINRA's compliance "with respect to the creation, operation and maintenance of a central [customer and order data] repository." The new entity is intended to be a dedicated resource solely for carrying out FINRA's obligations as Plan Processor of the consolidated audit trail ("CAT"). The update will take account of the governance procedures for the new subsidiary. In particular, the proposal would: codify the delegation of certain responsibilities and functions to FINRA CAT, LLC

Pursuant to Executive Order 13224, OFAC designated two individuals and three entities for "acting as conduits for sanctions evasion schemes" for Hizballah finances. The various entities and individuals were based in Belgium, the UK and Lebanon. OFAC stated that the two individuals and three entities designated are subject to "secondary sanctions" pursuant to the Hizballah Financial Sanctions Regulations. As a result of OFAC's action, all property and interests in property of the designated persons, or of any entity that is owned by one or more designated persons, that are in the United States

FINRA formed a new Office of Financial Innovation to serve as a "central point of coordination" for matters related to emerging uses for FinTech. FINRA stated that the new Office will oversee "outreach to FINRA stakeholders, training of FINRA staff, research and publications, internal coordination across FINRA, and collaboration with other regulators." Haimera Workie will head the new office. He is currently Senior Director at FINRA and was previously the Deputy Associate Director in the SEC Division of Trading and Markets.