FINRA Chair: Industry Needs To Improve Disclosures About Complicated Investments
by: Mark Schoeff Jr.
Financial Industry Regulatory Authority (FINRA) Chair Eric Noll, CEO of Context Capital Partners, said at FINRA’s annual conference that brokerages need to do a better job of explaining complicated products to clients. FINRA launched an exam sweep on options trading a couple of years ago and has joined the U.S. Securities and Exchange Commission in increasing its scrutiny of financial advisors’ recommendations of complex products. The increased regulatory efforts come amid calls by the industry and lawmakers to open private markets more widely to retail investors. “We have to really think about what that means to disclose risks and be transparent about what we do,” Noll said. “The more democratized our markets become, the more important that’s going to be.”
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