FINRA recently announced a new exam program and data collection technology

FINRA recently announced a new exam program and data collection technology.  The new program is now being based off your firm’s risk as defined by FINRA. FINRA has many data collection points – Form BD, Form BR, U-4/U-5 filings, FOCUS reports, SSOI filings, OATS, TRACE… the list goes on. The new exam program is designed to be more interactive with management, observing firm practices (at the Branch and OSJ Offices as well) coupled with reviewing the documentation to confirm you are properly testing the adequacy of your compliance program.  Do you have adequate controls in place? FINRA has moved from the old WebIR system to a format on Firm Gateway which is built to be more interactive allowing the examination team the ability to gain greater knowledge of your firm prior to the on-site.

Previously, FINRA had conducted these exams from a checklist-based format.  Today and going forward, they claim they will be better armed to conduct an exam that fits your membership.  We’ll have to see how this plays out – it may be more efficient and/or more intrusive; either way, the exam team will eventually understand the information they collected.

RegMaven encourages you to be prepared for an exam – FINRA and SEC.  Your regulators are building up their exam teams, resources and processes as we speak.