Emily Gordy shared her insights for a July 12
article about new Financial Industry Regulatory Authority guidelines that reduce or
eliminate enforcement fines for “extraordinary cooperation” from
broker-dealer firms under FINRA investigation.
The agency said its July guidelines are intended to clear up uncertainty
that has accumulated since FINRA’s 2008 guidance on extraordinary
cooperation and the benefits of going above and beyond in self-reporting
and aiding in investigations.
Gordy, a former FINRA enforcement department senior vice president, noted
that, to meet FINRA’s goal of increased transparency, FINRA intends to
issue public statements to illustrate situations when a firm’s
extraordinary cooperation led to no enforcement action.
“That’s critically important because when I was at [FINRA] and since I’ve
left, I’ve known of situations where investigations have been closed with
informal resolutions or simply with no action. It happens often … in the
industry; you don’t always hear about that,” Gordy said.
That will serve as an incentive for firms to do more than what FINRA
prescribed in 2008 guidance, she said, but won’t change assessments FINRA
will make in the future.