Firms should review the broker-dealer's acceptance, waiver and consent letter ("AWC"), which indicates the kinds of measures that FINRA expects firms to implement in supervising the internal communications between research analysts and sales personnel. FINRA Chief of Enforcement, Brad Bennett, urged firms to exercise "extreme vigilance" when supervising internal communications between research analysts and the sales personnel in order to avoid revealing material nonpublic information before…

The Associations recognized that (i) the regulators tend to know less materially than the industry about cybersecurity, and (ii) industry participants have every incentive to improve their cybersecurity defenses. The philosophical question presented is whether the regulators can resist the temptation to adopt prescriptive rules. Such rules are more likely to impede the work that firms do than they are to be useful.

To find examples of overly prescriptive rules, one only has to…

Any financial control person who becomes aware that their firm has fallen into a capital or custody deficiency must report the problem to the CFTC (or the SEC, in the case of a broker-dealer). To decide to report such a problem is not a judgment call; it is a requirement. The CFTC's two rules on such deficiencies lie at the very heart of the regulatory system, and the failure to notify regulators of a problem with compliance is a violation that can destroy confidence in a firm or in the…

Over the past several years, it has been asserted that derivatives prices in the aluminum market were manipulated by the warehouses, but the CFTC seems to have found no evidence to support those accusations. See ; .