FINRA Proposed Regs Require Expertise

FINRA has issued new proposed rules for non-broker/dealer funding portals. Those entities must become FINRA members in order to list security selling crowd funding issuers.

The good news is that  applications will generally be processed within 60 days after FINRA receives a “complete” application and its application fee. They will let you know whether its complete within 14 days after filing. Forms for application have been issued. Portals will need to file first with the SEC, then with FINRA.

Portals must, among other things, interview with FINRA, not be subject to certain “bad boy” events,  be capable of complying with federal securities laws, have certain policies/procedures in place including an anti-money laundering compliance program,  obtain a fidelity bond, comply with the FINRA conduct standards (including what can be in its communications), create and maintain a system of self supervision and file the required periodic reports with FINRA.

Comments on the proposed rules are due by February 3, 2014.

About JeffKoeppel

I am a corporate/securities attorney in the Washington, DC area. Prior to joining the firm, I was a Senior Attorney Advisor in the Division of Corporation Finance at the U.S. Securities and Exchange Commission. I am a member of the Bars of the States of Maryland, New York and the District of Columbia. You can also follow this blog on LinkedIn at:
This entry was posted in Broker dealers, Congress, Crowd Fund Act, Crowd Fund Act of 2012, Crowd Funding At the Margins, Crowd Funding Platforms, FINRA, Funding Portals, Investments, Jobs, Legislative Intent, SEC, Wall Street and tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

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