A year in the making, FINRA announced in late July 2018, that it had completed the reorganization of its enforcement program.  See  https://www.finra.org/sites/default/files/rule_filing_file/SR-FINRA-2018-027-nof-imm-eff.pdf.  Coupled with the consolidation was the creation of 2 new units: the Office of the Counsel to the Head of Enforcement and the Investigations Unit.  FINRA’s stated goal was to ensure consistency in its enforcement program while maintaining expertise in a number of areas.

In particular, over 150 attorneys will be placed in teams within groups.  These groups will be Main Enforcement, generalists, who will prosecute and investigate any disciplinary issue; Sales Practice Enforcement, specialists in sales practice investigations and prosecutions; and Market Regulation Enforcement, who will assist the Market Regulation staff in examinations and investigations as well as prosecuting any resulting offenders.

Not surprisingly, many of the changes FINRA appears to be implementing seem to mirror changes the SEC has made in the past.  It will be interesting to see if FINRA achieves its stated goals with this new structure.  However, we do not believe it will have much effect on how investigations and prosecutions will be conducted, that is, this seems more of an internal bureaucratic change as opposed to any goal of significantly increasing enforcement investigations and prosecutions.

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