FINRA (Financial Industry Regulatory Authority) was created in July 2007 with the consolidation of the regulation enforcement and arbitration functions of the New York Stock Exchange with the National Association Of Securities Dealers (NASD).
FINRA in conjunction with the Securities and Exchange Commission (SEC) are regulatory agencies for the financial services industry in the United States.
To be compliant with the guidelines, storage, retrieval and surveillance solutions need to be in place.
FINRA compliance has recently become more complicated with the release of Regulatory Notice 10-06, which covers social networking. In overview:
- Micro-blogging sites like Twitter are regarded as advertisements.
- Email or instant messenger that are sent to more than 25 prospects is considered as sales literature.
- Email or instant messenger sent to less than 25 prospects within 30 days, or a single destination, or an unlimited number of retail clients is considered correspondence.
- Social media sites like Facebook or LinkedIn that have password protection are regarded as sales literature.
- Discussions in chat rooms as considered as public appearances.