SERVING CLIENTS NATIONWIDE

SEC Approves FINRA Request to Publish Detailed Disciplinary Complaints and Decisions

The SEC approved a proposal that will allow FINRA to publicly release copies of all disciplinary complaints or decisions it issues, including the names of parties involved.

Previously, FINRA was restricted from posting complaints and was obliged to mask the names of parties not named as subjects, for instance, referring to a third party as "JD" instead of John Doe.

This is significant because under the new model, FINRA will be able not only to post a greater selection of complaints, similar to the current SEC framework, but will also allow FINRA to name third parties including brokers that might be involved with, but are not central to, a disciplinary incident and this mention will become public record.

The goal is to provide a more transparent and consistent approach to broker background information.

While some have expressed concern that the publication of a wider array of complaints may unfairly tarnish a broker's reputation based on a potentially erroneous claim, others are in agreement that the more information available to investors, the better.

Said Pete Bush of Horizon Wealth Management LLC: "That may give [investors] some good information to make a decision on whether to work with [a broker] or not."

The SEC-backed proposal affects FINRA's monthly and quarterly notices available online, as well as the FINRA BrokerCheck system.

News: Finra gets OK to share more info about reps' disciplinary records (InvestmentNews)

Categories