SEC, FINRA Lax In Telling Funds Of Ad Rule Changes: GAO

Law360, New York (July 27, 2011, 6:31 PM EDT) -- The U.S. Securities and Exchange Commission and Financial Industry Regulatory Authority are "uneven" in how they alert mutual funds to new interpretations of existing advertising regulations, according to a U.S. Government Accountability Office report released Tuesday.

FINRA, which generally enforces advertising rules written by the SEC, reviews mutual fund and exchange-traded fund advertisements and interprets rules governing how mutual funds and ETFs can advertise their products to investors, the GAO said.

But FINRA doesn't offer broad, public guidance when it changes how it's interpreting those rules,...
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