02.24.20
FINRA Examines the Hidden Costs of Free Trading
FINRA is reviewing the impact of some brokerage firms' move to offer commission-free trading. A targeted exam letter detailing a compliance sweep indicated that FINRA is looking for data from firms on the details of their commission practices and other forms of compensation. FINRA is also seeking information on firms' disclosure to clients; their order routing arrangements, including the details of any “payment for order flow” arrangements; their best execution procedures; and supervisory practices.
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