FINRA Publishes Annual Exam Trends Report

📘 FINRA Publishes Annual Exam Trends Report

FINRA has released its 2024 Annual Regulatory Oversight Report, providing insights into findings from FINRA’s Member Supervision, Market Regulation, and Enforcement programs. This report reflects FINRA’s commitment to providing greater transparency to member firms and the public about our regulatory activities. FINRA+11FINRA+11FINRA+11

🔍 Key Areas of Focus in the 2024 Report

1. Cybersecurity and Technology Management

Cybersecurity remains one of the principal operational risks facing broker-dealers. FINRA expects firms to develop and maintain cybersecurity programs and controls that are consistent with their risk profile, business model, and scale of operations. Firms should be aware of potential threats such as account takeovers, ransomware, and network intrusions. FINRA

2. Crypto Asset Developments

The report introduces new content dedicated to crypto assets, highlighting the evolving landscape and associated risks. Firms are encouraged to assess their exposure to crypto assets and ensure compliance with applicable regulations. FINRA+1FINRA+1

3. Artificial Intelligence (AI) Trends

The expansion of AI crosses many business sectors, technologies, and operations. Firms are advised to consider the implications of AI on their operations and ensure that their use of AI aligns with regulatory requirements. FINRA

4. Off-Channel Communications

FINRA provides guidance concerning firms’ supervision and retention of off-channel communications. Firms should implement policies and procedures to monitor and retain communications conducted through non-traditional channels. FINRA+9FINRA+9LinkedIn+9

5. Market Integrity

New topics within the Market Integrity section include OTC Quotations in Fixed Income Securities and Advertised Volume. Firms are encouraged to review their practices to ensure compliance with market integrity standards. FINRA+3FINRA+3FINRA+3

🛠️ Utilizing the Report for Compliance

FINRA’s Annual Regulatory Oversight Report serves as a critical resource for firms to strengthen their compliance programs. The report provides updates on established areas and guidance on emerging risks to help firms navigate the ever-changing landscape.