20 May 2018

US Corporate Law News: Revised FINRA customer confirmation rule takes effect


Flora Tsui
Associate | US

Approved by the SEC, the Amendments to the Financial Industry Regulatory Authority's Customer Confirmation Rule 2232 (the “Amended FINRA Rules”) took effect on May 12, 2018. The Amended FINRA Rules require broker-dealers to disclose additional transaction-related information to retail customers who trade in certain fixed income securities. Pursuant to the Amended FINRA Rules, a FINRA member is now specifically required to disclose the amount of mark-up or mark-down it applies to trades with retail customers in corporate or agency debt securities if the member also executes an offsetting principal trade in the same security on the same trading day. In addition, the Amended FINRA Rules now also require its members to provide additional line items on all retail customer confirmations for corporate and agency debt security trades, including reference and hyperlink to a web page hosted by FINRA that contains publicly available trading data for the specific security that was traded, and the execution time of the transaction, expressed to the second. For more information, see http://finra.complinet.com/en/display/display.html?rbid=2403&element_id=9788.

Flora Tsui Associate | New York