FINRA announced today in Regulatory Notice 09-23 that the SEC has approved proposed changes for Forms U-4 and U-5, as well as rules relating to FINRA's BrokerCheck disclosure system.
There are a few changes to the forms, but it appears that the significant changes are these:
** New questions on the forms will require firms and brokers to report arbitration claims and litigation actions that involve sales practice allegations against a broker, even when the broker is not named as a party to the arbitration or litigation. While new forms are apparently already on CRD now, the effective date for the new disclosure questions is November 14, 2009.
** The new threshold for disclosure of reporting settlements of customer complaints will be $15,000, up from $10,000. The effective date for this change is May 18, 2009.
Compliance and registration folks should thoroughly review this Regulatory Notice for information on when and how updates for Forms U-4 must be filed to respond to the new questions.
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