Finra asks for comments on underwriting rules
Self-regulator wants to encourage capital-raising while still protecting investors.
The Financial Industry Regulatory Authority Inc. has requested comment from member firms on its rules that govern capital-raising activities. The move is part of Finra’s efforts to modernize the regulation of those activities while maintaining protections for investors, the self-regulator said in a press release.
In addition to its request for comments on the topic generally, which it published in Regulatory Notice 17-14, Finra also requested comments on proposed amendments to modernize, simplify and clarify Finra Rule 5110, which applies to underwriting terms and arrangements regarding the public offering of securities.
Finra requested that comments be made by May 30, and asked members to comment on particular issues including whether Finra rules relating to capital-raising effectively respond to the problems they were intended to address, the costs and benefits of Finra’s capital-raising rules, any unintended consequences of regulation, and whether Finra can make any of its administrative processes or interpretations related to capital-raising more efficient and effective.
The capital-raising rule review is part of Finra’s 360 initiative, a comprehensive examination of all Finra regulations and programs.
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