How FINRA Is Enhancing Member Firm Examinations
FINRA is overhauling its member‑firm examination program under the FINRA Forward initiative, shifting to a risk‑informed, data‑driven model that promises greater efficiency and transparency. The new framework uses firm business‑model classifications and an 11‑category risk matrix—evaluating likelihood and impact—to determine exam frequency, scope, and staffing. First‑exam processes now tier new firms based on application data, allowing low‑risk entrants to receive streamlined reviews, while ongoing exams for low‑risk firms have been stretched from four to six years. Targeted data requests and advanced notice further reduce the regulatory burden. Jim Reese highlighted that roughly 80% of new firms fall into the lowest‑risk tier, resulting in a measurable drop in examination time since June. Feedback loops with chief compliance officers and continuous intelligence from risk‑monitoring teams ensure exams stay dynamic and focused on emerging threats. By reallocating resources toward higher‑risk firms, FINRA aims to strengthen investor protection and market integrity while easing compliance costs for the majority of member firms, setting a new standard for regulatory oversight efficiency.
Trading Around the Clock: Inside FINRA's Trade Reporting Enhancements
FINRA has extended its Trade Reporting Facility operating hours to begin at 4 a.m. Eastern Time, a step toward a 23‑hour, five‑day trading schedule slated for December 2026. The regulator also rolled out mandatory reporting for fractional‑share transactions, a move designed to...
How FINRA Is Streamlining Data Requests
FINRA’s latest initiative focuses on streamlining data requests to improve oversight while reducing the compliance burden on member firms. Under the FINRA Forward agenda, senior leaders Sam Dradi and Jay Koutros explained how the regulator is shifting from broad,...