SIFMA requested that FINRA allow member firms to rely on remote inspections of branch offices for the duration of the COVID-19 pandemic.

In a comment letter on FINRA proposed amendment to Rule 3110 (“Supervision”) to temporarily extend the annual office inspection deadline for member firms until March 31, 2021 (see previous coverage), SIFMA asked that FINRA member firms “be permitted to rely on remote branch inspection programs that leverage existing, proven processes and technology to ensure that sales practice risks, suitability risks and investor protection concerns are properly addressed, in lieu of an on-site inspection in 2020, for the duration of the COVID-19 pandemic.”

SIFMA cited “increasing operational challenges, travel restrictions, health and safety risks, and uncertainties presented by the COVID-19 pandemic” as reasons member firms would be unable to complete on-site branch inspections by the extended deadline.

Primary Sources

  1. SIFMA Comment Letter to FINRA: Proposed Rule Change to Temporarily Extend the Time to Complete Office Inspections under FINRA Rule 3110 (“Supervision”)

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.