Regulatory Outlook | 06.23.20
FINRA Amends Suitability, CAB Rules to Align with Reg BI
The SEC has approved FINRA's plan to amend its suitability and noncash compensation rules to provide clarity on which standard applies and to address inconsistencies with Regulation Best Interest (Reg BI). FINRA and capital acquisition broker (CAB) suitability rules will be changed to state that the rules do not apply to recommendations subject to Reg BI, and to remove the element of control from the quantitative suitability obligation. Rules governing noncash compensation, meanwhile, will be conformed to Reg BI's limitations on sales contests, sales quotas, bonuses, and noncash compensation.
Read the full article on Think Advisor.