January 13, 2011 Comments (0) Blog, Securities Fraud

FINRA Know Your Customer Rule

(Last Updated On: July 17, 2015)

Financial Advisors have a fiduciary duty to research investments and to make sure that every investment they recommend is suitable for the client.  This obligation is typically called the “Know Your Customer” Rule.  Generally, in order to determine whether an investment is suitable, a stockbroker must know the clients age, net worth, investment objectives, investment experience, and tolerance for risk.

FINRA recently announced that the SEC approved its proposal to adopt rules governing know-your-customer and suitability obligations for the consolidated FINRA rulebook. The new rules are based in part on and replace provisions in the NASD and NYSE rules.  For more information on the proposal to adopt rules governing the “Know Your Customer” Rule, visit:

http://www.finra.org/web/groups/industry/@ip/@reg/@notice/documents/notices/p122778.pdf

The consolidated FINRA Rules regarding suitability go into effect October 7, 2011.

If you have questions regarding whether your financial advisor breached its fiduciary duty in recommending an investment to you, the securities attorneys of The White Law Group may be able to help.  For a free consultation, call the firm’s Chicago office at 312-238-9650.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida. With over 30 years of securities law experience, including experience working at FINRA (f/k/a the NASD) and the SEC, The White Law Group has the expertise to help investors defrauded in securities, investment and financial business transactions.

For more information on The White Law Group, please visit our website at http://www.whitesecuritieslaw.com.

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