The Financial Industry Regulatory Authority announced yesterday that its National Adjudicatory Council has revised the industry self-regulator’s sanction guidelines.
The sanction guidelines aim to assist Finra’s adjudicators, including its hearing panels and the National Adjudicatory Council appellate tribunal, in imposing consistent and fair sanctions, Finra says. The guidelines detail common securities rule violations and resultant sanctions, and they also provide a framework for settlement negotiations between Finra’s Department of Enforcement and its member firms and individuals, Finra says.
The revisions split each current guideline into separate guidelines for individuals and firms, establish separate fine ranges for small and mid-size or large firms, remove the $310,000 upper limit fine for mid-size and large firms for select guidelines, establish anti-money laundering guidelines, elaborate on non-monetary sanctions for repeated violations and serious misconduct, establish single fine ranges for violations of select guidelines, establish $5,000 as the minimum fine for firms, and remove some infrequently used guidelines, according to information on Finra’s website.
Finra defines a small firm as one with no more than 150 registered persons, a mid-size firm as one with at least 151 and no more than 499 registered persons, and a large firm as one with 500 or more persons, according to information on its website.
“The changes to the sanction guidelines align the sanctions to where Finra’s enforcement program has evolved. The sanction guidelines also bolster Finra’s mission of protecting investors by reflecting how grave violations of Finra’s rule will result in serious sanctions,” Jessica Hopper, executive vice president and head of Finra’s Department of Enforcement, said in a statement accompanying the guidelines.