FINRA recently released updated and revised Sanction Guidelines and an accompanying Regulatory Notice that, among other things, call for stricter penalties against broker-dealers who commit fraud or violate suitability rules. The revisions are effective as of May 12, 2015.
The Sanction Guidelines, first published in 1993, are intended to assist FINRA’s adjudicators in determining the appropriate disciplinary penalties for violations of the FINRA rules. Rather than provide predetermined or fixed sanctions for particular violations, the Sanction Guidelines provide a suggested range of penalties for such violations and allow adjudicators to consider various factors in determining the appropriate penalty. The Sanction Guidelines provide members and associated persons with an understanding of the sanctions associated with particular violations, thereby facilitating settlements.