Broker-Dealers Call for End to Regulation by Enforcement

June 28, 2017

Broker-Dealers Call for End to Regulation by Enforcement

June 26, 2017 | by Rita Raagas De Ramos | Financial Advisor IQ

Executives at broker-dealer firms speaking at a compliance trends panel during Finra’s annual conference last month were united in calling for an end to regulation by enforcement. In its place they want succinct, clear, tell-it-as-it-is guidelines.

“We’d like to get back to regulation by guidance – an environment we had in what seems like a million years ago, when we received a lot more solid guidance about what Finra and other regulators had seen in their audits and in the industry as a whole,” said Amy Webber, president and CEO of Cambridge Investment Research. A regulation by enforcement culture encourages broker-dealers to “always be on the defense, she added.

Finra CEO Robert Cook has said the self-regulator is continuing to gather input and to identify improvements that can be done during an ongoing comprehensive self-evaluation and organizational review, referred to as Finra 360. “We are committed … to take a fresh look at what we do today and to provide greater transparency and guidance to the industry where appropriate,” he said.

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Ramón A. Rivera-Ramos
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