Regulatory Update: 2021 FINRA Examination Priorities

FINRA issued its 2021 Report on FINRA’s Examination and Risk Monitoring Program

Report Combines and Replaces Annual Exam and Risk Monitoring Findings Report, Priorities Letter: 

The Report identifies the applicable rule and key related considerations for member firm compliance programs, summarizes noteworthy findings from recent examinations, outlines effective practices that FINRA observed during its oversight, and provides additional resources that may be helpful to member firms in fulfilling their compliance obligations.

The Report addresses 18 regulatory areas organized into four categories: Firm Operations, Communications and Sales, Market Integrity and Financial Management. These topics include:

• Firm Operations

  • Anti-Money Laundering

  • Cybersecurity and Technology Governance

  • Outside Business Activities and Private Securities Transactions

  • Books and Records

  • Regulatory Events Reporting

  • Fixed Income Mark-up Disclosure

• Communications and Sales

  • Reg BI and Form CRS

  • Communications with the Public

  • Private Placements

  • Variable Annuities

• Market Integrity

  • CAT

  • Best Execution

  • Large Trader Reporting

  • Market Access

  • Vendor Display Rule

• Financial Management

  • Net Capital

  • Liquidity Management

  • Credit Risk Management

  • Segregation of Assets and Customer Protection

As in prior years, FINRA will also adapt the areas of focus for its Examinations and Risk Monitoring programs during 2021 to address emerging regulatory concerns and risks for investors that may arise throughout the year.

Read the Report here: https://www.finra.org/rules-guidance/guidance/reports/2021-finras-examination-and-risk-monitoring-program