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EB-5 Insights Where Government Policies and Business Realities Converge

New Background Check Obligations on the Horizon for Securities Broker-Dealers

Posted in Securities Law

Written by Richard M. Cutshall, Steven M. Felsenstein, and Carl A. Fornaris

On Dec. 30, 2014, the SEC approved a proposed rule change pursuant to which FINRA is adopting a revised version of NASD Rule 3010(e) concerning background investigations of proposed registered representatives and adding a new obligation for member firms’ written supervisory procedures to require a national background check on such individuals. This GT Alert gives an overview of the new rule that becomes effective July 1, 2015. FINRA member firms should start taking the time now to amend their written supervisory procedures to specifically address their new background check obligations and begin discussing with vendors how background searches will be effected and documented.

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