Monthly Regulatory Summary As the regulatory landscape is constantly evolving, Compliance Risk Concepts (“CRC”) is […]
Recently FINRA published its findings regarding a funding and liquidity review of 43 broker/dealers. Has anyone noticed that 9 out of 24 BD's Reviewed are not prepared to respond to customer withdrawal of funds. In fact, the only test that all 43 Firms were prepared for was liquidating inventory. I am not sure liquidating inventory is going to assist the investing public.
The results aren't so surprising, but what is surprising is that these statistics fall at the very end of the Notice (FINRA Regulatory Notice 15-33). Would it have made a difference if FINRA had published this report to the investing public and informed the investing public that FINRA has direct knowledge that 9 Broker/Dealers could not respond to an influx of customer withdrawals.
While noble that FINRA is issuing guidance to broker/dealers - does FINRA have responsibility to the investing public to inform them of these 9 ill prepared broker/dealers? And what is FINRA doing to ensure that these 9 broker/dealers become prepared quickly. Seven years ago was the last financial crisis. Are Broker/Dealers any better prepared now?