Overview#Financial Industry Regulatory Authority Inc (FINRA) is a private corporation that acts as a Self-regulatory Organization (SRO).
Financial Industry Regulatory Authority Inc is the successor to the National Association of Securities Dealers, Inc. (NASD) and the member regulation, enforcement and arbitration operations of the New York Stock Exchange.
The United States Federal Agency which acts as the ultimate Regulatory Agencies of the securities industry, including Financial Industry Regulatory Authority Inc, is the United States Securities and Exchange Commission.Bank Secrecy Act and its implementing regulations ("Anti-Money Laundering rules"). The purpose of the AML rules is to help detect and report suspicious activity including the predicate offenses to money laundering and terrorist financing, such as securities fraud and market manipulation.
FINRA reviews a firm’s compliance with AML rules under FINRA Rule 3310, which sets forth minimum standards for a firm’s written AML Regulatory compliance program. The basic tenets of an AML compliance program under FINRA 3310 include the following.
- The program has to be approved in writing by a senior manager.
- It must be reasonably designed to ensure the firm detects and reports suspicious activity.
- It must be reasonably designed to achieve compliance with the AML Rules, including, among others, having a risk-based Customer Identification Program (CIP) that enables the firm to form a reasonable belief that it knows the true identify of its customers.
- It must be independently tested to ensure proper implementation of the program.
- Each FINRA member firm must submit contact information for its AML Compliance Officer through the FINRA Contact System (FCS).
- Ongoing training must be provided to appropriate personnel.