FINRA Exam Gives Handy Map To Spot Conflicts In Broker Pay

Law360, New York (August 24, 2015, 6:38 PM EDT) -- A new probe by the Financial Industry Regulatory Authority finds the regulator charting a deep dive into the murky and sometimes conflicted world of broker-dealer pay practices, but in making its so-called sweep exam public, FINRA also has mapped out where it sees potential compensation conflicts arising and indicated ways in which firms can prevent them.

The Wall Street-funded regulator recently published online an examination letter it sent to about a dozen retail-oriented brokerage firms, in which it sought an extensive amount of information about how the firms manage and mitigate the conflicts that arise when paying registered representatives hefty commissions...

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