Finra is still looking for a way to expand consumers' use of its BrokerCheck system, which makes work profiles and regulatory histories of thousands of current and former licensed registered representatives and broker-dealers online.
To that end, the
Financial Industry Regulatory Authority Inc. earlier this month drafted a proposed amendment that would put new requirements on broker-dealers to connect consumers to BrokerCheck.
The proposal “would require member firms to include a reference and a link to BrokerCheck on their websites and on certain websites maintained by, or on behalf of, any person associated with member firms,” according to an update posted on Finra's website about a September meeting of Finra's board of governors.
At the moment, many of the 4,379 broker-dealers licensed by Finra have no such links. Likewise, profiles of brokers posted by their firms typically have no links to BrokerCheck.
Finra chief executive Richard G. Ketchum has made it clear that Finra wants consumers to be more aware of BrokerCheck. It was one of the themes of his formal and informal comments in May at the self-regulatory organization's annual meeting in Washington.
The issue of what to disclose in BrokerCheck reports has been nettlesome for Finra and those it regulates. In February, Finra officials indicated that they were considering, among other things, posting brokers' licensing test scores on the public database.
The proposal did not sit well with representatives or their advocacy groups.
But in a speech in May, Mr. Ketchum said that Finra had no interest in collecting or publicizing such information.
Finra, however, may be proposing another disclosure item that may not sit well with the 633,000 registered reps.
Another new rule proposal would “permanently make available in BrokerCheck information about investment-related civil actions brought against associated persons by a state or foreign regulatory authority that have been dismissed pursuant to a settlement agreement.”
