At a glance
- The proposal, filed with the SEC earlier this week, would require at least seven industry governors and at least five from the public, and cap the board at 20 members, down from 25.
- The public-member majority has been in place since 1996, when the SEC required FINRA's predecessor to adopt reforms aimed at potential conflicts of interest.
- Advisors at broker-dealers and wirehouses can weigh in during the 21-day SEC comment period on a board that oversees an organization able to suspend brokers.
FINRA proposed shifting its board to a majority of representatives from the firms it regulates, AdvisorHub reported.
The proposal, filed with the SEC earlier this week, would require at least seven industry governors and at least five from the public, and cap the board at 20 members, down from 25.
The public-member majority has been in place since 1996, when the SEC required FINRA's predecessor to adopt reforms aimed at potential conflicts of interest. FINRA said the factors at play then are “significantly different from the environment Finra faces today” and that the changes preserve safeguards for its regulatory mission. Tyler Gellasch, chief executive of the Healthy Markets Association, told AdvisorHub that a regulator “structurally captured” by the firms it oversees raises questions about its ability to do the job.
Advisors at broker-dealers and wirehouses can weigh in during the 21-day SEC comment period on a board that oversees an organization able to suspend brokers.
Reported by the Practice management desk from AdvisorHub. Published . Corrections