Comment Letter: FINRA Engagement Initiative

Dear Ms. Mitchell:

STA welcomes the opportunity to offer comment on FINRA Special Notice (the “Notice”) Engagement Initiative. We greatly respect and appreciate FINRA’s 360 Review, in particular this request for comment on FINRA’s Engagement Initiatives.

STA’s diverse membership, as measured by geography and business models, and long history of interacting with FINRA and its preceding organizations offers a unique perspective on FINRA’s Engagement Initiatives which we hope will contribute favorably to any strategic decisions made by FINRA.

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Comment Letter: FINRA Safe Harbor on Desk Commentary

Dear Ms. Mitchell,

The Security Traders Association (“STA”) [1]welcomes the opportunity to comment on proposed amendments to FINRA Rule 2241 (Research Analysts and Research Reports) and FINRA Rule 2242 (Debt Research Analysts and Debt Research Reports) to create a limited safe harbor for “specified brief, written analysis distributed to eligible institutional investors that comes from sales and trading or principal trading personnel but that may rise to the level of a research report (desk commentary)”[2], herein referred to as, the “Proposal”, or the “Safe Harbor”. The Safe Harbor would be non-exclusive and only available to communications that meet specific conditions regarding the author, the content of the communication and the recipient of the communication. Each limitation reflects FINRA’s stated objective to ensure that retail investors retain the full protections of the research rules and that any safe harbor does not cause firms to migrate their research function to the trading desk to avoid Rules 2241 or 2242.

[1] The STA is a trade organization founded in 1934 for individual professionals in the securities industry and is committed to promoting goodwill and fostering high standards of integrity in accord with the Association’s founding principle, Dictum Meum Pactum – “My Word is My Bond”

[2] FINRA Regulatory Notice 17-16 April 2017

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FINRA Cybersecurity Report/eSentire

Special Presenter: J. Paul Haynes, eSentire

On February 2, 2015 FINRA released a report for financial firms on cybersecurity practices. Information found in the report is based on various assessment initiatives conducted by FINRA in 2014. The report is intended to educate firms on cyberattacks in general and to offer recommendations and best practices on how firms can better protect their clients and employees from such attacks.

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Special Presenter: Mike Rufino, FINRA

This evening we will be featuring FINRA’s requests for comments on a rule proposal to implement the Comprehensive Automated Risk Data System, better known as CARDS.

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FINRA’s Regulatory Notice 14-07; ATS Reporting

Special Presenter: Chris Stone, FINRA

On January 17, 2014, the SEC approved two (2) proposed FINRA rule changes; (i) adopt FINRA Rule 4552 which requires each ATS to report to FINRA weekly volume information and number of securities transactions within the ATS and (ii) to also require each ATS to acquire and use a single, unique MPID when reporting information to FINRA.

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