The Financial Industry Regulatory Authority, Inc. (FINRA) posts the disciplinary actions it took to an online database. It also publishes a monthly summary of these actions, which is a worthwhile read for those in the industry—if only for insight into FINRA’s current priorities. Below, I offer a thought on FINRA’s March 2026 edition.
FINRA’s March 2026 Disciplinary Report Offers Practical Lessons on Remediation
FINRA’s report underscores a familiar but important point for broker-dealers and registered persons: remediation can matter. Across several matters, FINRA expressly noted corrective steps such as revising written supervisory procedures, implementing new review processes, or undertaking additional compliance obligations.
Remediation Appeared in Several Different Contexts
The matters in the report involved a range of alleged or found deficiencies, including municipal securities reporting, close-out failures, options position reporting, low-priced securities supervision, public communications, Reg BI procedures, electronic communications, and customer overcharges. Although the underlying conduct varied, the remediation themes were consistent.
Updating Written Supervisory Procedures Was a Recurring Theme
Several matters involved findings that written supervisory procedures were not reasonably designed to achieve compliance with applicable obligations. In response, firms revised or enhanced their procedures.
One matter involving customer complaint reporting also ended with the firm updating its procedures. FINRA took a granular approach and found that the firm’s procedures did not provide adequate guidance on identifying customer complaints, distinguishing broker-dealer complaints from issuer-related grievances, or determining whether complaints required regulatory reporting or Form U4 disclosure. The firm later updated its complaint-related procedures.
Systems Fixes and Surveillance Enhancements Also Noted
FINRA also highlighted remediation where firms corrected technology or data problems that contributed to reporting failures.
In one options reporting matter, the firm failed to report certain over-the-counter options positions to the Large Options Positions Reporting system because of multiple system and data issues. The report noted that the firm identified, self-reported, and remediated certain issues, including data-field and salesperson-location problems.
That matter illustrates a key lesson: when reporting failures stem from systems architecture or data flows, remediation should not be limited to a written policy update. Firms should consider whether the underlying logic, data mapping, exception reporting, and supervisory testing are adequate to prevent recurrence. I also encourage compliance personnel to understand their firm’s data—at least at a high level.
Practical Takeaways for Broker-Dealers
FINRA’s March 2026 report suggests several practical takeaways:
- Written procedures should match actual practice. FINRA repeatedly scrutinized whether procedures provided meaningful guidance and whether firms actually implemented the processes described.
- Technology controls require supervision. Automated systems, reporting logic, and vendor platforms should be tested and reviewed. A technology-based control is only as effective as the firm’s ability to validate it.
- Documentation matters. Firms should document when an issue was identified, what corrective steps were taken, who approved them, how they were implemented, and how the firm tested whether they worked.
Because broker-dealers, registered investment advisers and their representatives want to spend their time serving their clients, not their regulators.