New FINRA Rules Expand Liability to Customers

The Financial Industry Regulatory Authority (FINRA) proposed and the SEC approved FINRA Rule 2090 (Know Your Customer) and FINRA Rule 2111 (Suitability) as part of the process of developing the consolidated FINRA rulebook. These new rules became effective this month. As with their predecessor rules, failure to comply with these expanded requirements will serve as the starting point for investor claims against brokers and investment advisors.

We review the new rules and their implications in this article.

 

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