Category: Alerts

2021 Report on FINRA's Examination and Risks Monitoring Program

Introduction

FINRA recently published an extensive 46-page interactive report for its member firms. This document reports on FINRA’s 2021 Risk Monitoring and Examination Activities1 (the Report), providing annual insights from FINRA’s ongoing regulatory operations, and is designed to inform member firms as they update and maintain their compliance programs.

The Report covers a select but extensive number of activities from Firm operations, Communications and Sales, Market Integrity and Financial Management. Additionally, the report discusses the following key points:

· Regulatory Obligations and Related Considerations.

· A brief description of relevant federal securities laws, regulations and FINRA rules, and questions FINRA may ask or consider when examining a firm for compliance with such obligations.

· Key Findings, Observations and Effective Practices from recent examinations.

· Noteworthy findings that FINRA has observed at some—but not all—member firms.

· Select effective practices FINRA observed in recent exams, as well as those noted in prior Exam Findings Reports that may help member firms, depending on their business model, evaluate their own programs.

· Emerging Risks – Areas where FINRA has recently observed new or frequent incidents of risk.

· Additional Resources – A list of relevant FINRA Notices, other reports, tools, and online resources.

An example of the information provided in the Report can be found here Cybersecurity and Technology.

An Appendix is also included that outlines how member firms have used similar FINRA reports (Exam Findings Reports or Priorities Letters) in their compliance programs.

Conclusions

FINRA advises each member firm to review the Report and to consider incorporating relevant practices into their compliance programs. These practices should be customized to the activities of the firm. Reviewing this Report may help member firms prepare for examinations as many of the areas addressed represent ongoing core compliance responsibilities that are reviewed as part of FINRA’s risk-based exam program each year. FINRA expects to revisit this report each year.

How can Alaric help?

Alaric is a leading provider of Compliance Solutions for FINRA Members. Through our Mock Examination Service, Alaric will replicate a typical FINRA examination tailored to your firm’s business activities to evaluate the effectiveness of your compliance program.

For more information or immediate assistance, please contact us or call us at 1-888-243-2448.

 

1. 2021 FINRA Examination and Risk Monitoring Program Report

Back to Alerts
×
Request a Proposal