Re-Proposed FINRA Rule Would Require Brokerage Firms to Disclose Recruitment Practices

Posted on June 4th, 2015 at 11:42 AM
Re-Proposed FINRA Rule Would Require Brokerage Firms to Disclose Recruitment  Practices

From the Desk of Jim Eccleston at Eccleston Law LLC:

FINRA has re-proposed a rule that would require brokerage firms to inform clients of their recruitment practices. If the proposed rule is enacted, brokerage firms would be required to send a disclosure to clients after luring brokers away from competitors with large pay packages.

The disclosure would inform clients that some recruitment practices have potential incentives encouraging brokers to convince that clients to move their accounts to the brokers' new firm. In addition, FINRA has stated that the disclosures would notify clients that they may be charged fees to move assets and that some assets may not be easily transferred.

The new rule would require that those communications be sent by brokers within three business days after informing the client about his or her employment transition.

The attorneys of Eccleston Law LLC represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 65 years in delivering the highest quality legal services.

Related Attorneys: James J. Eccleston

Tags: James Eccleston, Eccleston Law, Eccleston Law Offices, FINRA,

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