Published On: June 15, 2015

The Financial Industry Regulatory Authority (FINRA) has proposed a rule that would require brokerage firms to inform clients of certain recruiting practices. It would require firms to disclose to clients if they lure away brokers from competing firms. The rule would disclose the incentives used to lure brokers away, and the incentives the brokers would use to convince clients to move with them to their new firm. The disclosures would also require that some client assets may not be easily transferred. These disclosures would need to be sent within three business days after informing the client of a broker’s employment transition.

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