Finra proposes making regulatory continuing education an annual requirement
New approach also would allow previously registered brokers to remain in the industry through CE
Finra has proposed making continuing education on regulatory issues an annual requirement and allowing brokers whose registrations are terminated to stay in the industry by completing educational requirements.
In a regulatory notice posted Tuesday, the Financial Industry Regulatory Authority Inc. proposed making several changes to its continuing education program based on recommendations the broker-dealer self-regulator received from Securities Industry/Regulatory Council on Continuing Education in 2018.
Under the proposal, brokers would have to complete continuing education focused on regulatory requirements and industry standards every year before the end of the calendar year. Currently, regulatory continuing education must be completed every three years. In another change, Finra would publish in advance the topics to be covered in regulatory CE.
The “firm element” of continuing education centers on securities products, services and strategies, as well as firm policies and industry trends. It will continue to be required annually. But Finra is proposing to allow firms to count anti-money-laundering training and other kinds of financial industry CE to satisfy registered representatives’ annual firm element requirement.
In another change, Finra would allow reps whose registration has been terminated because they’re no longer working in the industry to maintain their qualification through annual continuing education. The change is meant to align brokers with other professionals, such as lawyers and accountants, who can stay in their fields during an absence by completing continuing ed courses.
“The proposed changes are expected to result in a more efficient CE program that addresses relevant regulatory requirements and provides individuals the best tools and resources to understand and comply with such requirements, enhancing investor protection,” the proposal says. “Moreover, the proposed changes would provide new channels for individuals to maintain their qualification status for a terminated registration category and, in so doing, could increase the likelihood that professionals who need to step away from the industry for a period could return.”
Finra is proposing changes to its CE program as state securities regulators are seeking to impose CE requirements on investment adviser representatives.
The Finra proposal is open for public comment until April 20. The Securities and Exchange Commission must approval all Finra rule proposals.
[More: Finra seeks minimum expungement fees of several thousand dollars]
Learn more about reprints and licensing for this article.
