FINRA issued a publication detailing its examination priorities and deficiencies frequently cited in its examination program. The list of examination priorities includes the following: (1) anti‑money laundering, (2) protection of customer information, (3) supervision and supervisory controls, (4) sales of new or non‑conventional products, (5) transaction reporting, (6) business continuity planning, (7) bank sweep programs, (8) agency lending disclosure and (9) the Order Audit Trail System. Many of these same topics are covered in the listing of frequently found deficiencies, which provides additional information on compliance requirements for each area. The other topics covered in the frequently found deficiencies section include the following: (a) changes in account name or designation, (b) time and price discretion, (c) net capital, (d) customer protection, and (e) operational effects of transaction processing on books and records, net capital and customer protection compliance.
Alert June 10, 2008