05.18.26

FINRA Tests Plan To Allow Some Firms To Avoid Investigation After Self-Reporting

by: Miriam Rozen

The Financial Industry Regulatory Authority (FINRA) has launched a pilot program that could allow some financial firms to avoid immediate regulatory investigations if they properly self-report potential violations. Under the initiative, participating firms would complete more detailed disclosure forms, conduct their own internal reviews and carry out remediation efforts while providing updates to FINRA as needed. A senior enforcement official said the goal is to give firms more “ownership” of compliance problems and resolve issues more efficiently without the burden of a simultaneous formal investigation. However, FINRA emphasized that participation in the pilot does not guarantee immunity, as the regulator can still investigate, request information or bring disciplinary actions.

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