FINRA Ready to Provide ‘Technical’ Aid on Fiduciary Rule, Legal Chief Says

The Financial Industry Regulatory Authority stands ready to offer “technical help” to the Labor Department and the Securities and Exchange Commission as the 2 companies collaborate a fiduciary rulemaking, stated Robert Colby, FINRA’s primary legal officer.

Speaking on a panel at the National Society of Compliance Professionals nationwide conference in Washington Monday, Colby stated that FINRA “would love to see a best-interest requirement used that was likewise used throughout the broker-dealer world.”.

FINRA “commented” on Labor’s guideline that the commission was the best firm to craft a fiduciary requirement, Colby stated. FINRA “still believes that. You do not get a lot of 2nd chances in Washington, but the SEC has a 2nd opportunity to come up with its own guideline and deal with the DOL to obtain to a collaborated requirement.”.

FINRA is “standing ready to offer any sort of technical support … we have a very excellent working relationship with DOL; we talk to them relatively typically and with the SEC, too.”.

Colby included that if a “real best-interest requirement that used to broker-dealers” is promoted, FINRA “would want the opportunity to return and look at our rulebook, to see if the guidelines that we presently have actually that are meant to resolve particular disputes had to be done the specific very same way.”.

When asked by panel mediator Norm Ashkenas, senior vice president and chief compliance officer of Fidelity Brokerage Services, if Labor is responsive to “technical” support from FINRA, Colby reacted. “It’s been a very comprehensive reception. I think they’re attempting to determine ways to make their guideline work. They’re speaking to SEC, speaking to us.”.

Ashkenas then asked panel members about the state fiduciary guidelines in play.

John Polise, associate director of Broker-Dealer and Exchange Oversight in the SEC’s Office of Compliance Inspections and Examinations, specified that “we need to get a complete commission when handling a long-ranging policy,” like a fiduciary rulemaking, to get any traction. “I think something’s going to happen, but we need an emergency to make those choices.”.

The Senate Banking Committee will hold a hearing Tuesday for Hester Peirce and Robert Jackson, the 2 candidates for open SEC commissioner slots.

Susan Axelrod, executive vice president of Regulatory Operations at FINRA, who also spoke on the panel, included that Labor’s guideline and other fiduciary requirements are “not unlike other locations where you might see diverse regulative requirements– cybersecurity is a fine example of that too … It’s seriously crucial for the regulators to continue to collaborate and not set different requirements because it becomes difficult for the market to comply.”.