FINRA’s Board of Governors met on December 2-3, 2020, to review FINRA’s 2020 financial performance, approve the organization’s 2021 proposed budget, reaffirm FINRA’s Financial Guiding Principles, approve rule proposals, and receive several operational updates.

The Board approved two rule proposals to be filed with the Securities and Exchange Commission (SEC), directing impacting our clients. As customary, the proposed rules will be published for public comment within the year and must be approved by the SEC before becoming effective.

One rule proposed amendments to enhance FINRA’s Continuing Education (CE) Program. The proposed rule would serve as amendments to FINRA Rules 1210 and 1240 and require registered persons to complete the Regulatory Element of the CE program every year (rather than every three years). The proposed rule would also allow individuals who terminate their registrations to reregister for an extended period, without retaking the required examinations, if they maintain their CE requirements during this period.

Another proposed rule serves as an amendment to the FINRA Rule 9000 Series and establishes a process to appeal statutory disqualification determinations made by FINRA staff.  The new process will provide individuals with the ability to challenge a FINRA decision that the person is subject to a statutory disqualification, without needing the support of a firm to do so.

We encourage our clients to review the December 2020 Board Update in detail. It serves as a useful resource in remaining up to date on future FINRA activities, initiatives, and rules. The next FINRA Board of Governors Meeting is currently scheduled for March 3-4, 2021.