(Bloomberg) — Some brokers might not be getting the best prices for clients when they send stock orders to exchanges that offer rebates, regulators said in an outline of annual oversight priorities.
Recent brokerage inspections found that some firms don't have active "best-execution committees" or other supervisors in place to ensure that clients get the best price as securities rules require, the Financial Industry Regulatory Authority said today in a letter about its 2015 exam topics.
"We certainly expect to see tightening up and much greater focus from firms," Finra Chief Executive Officer Richard Ketchum said in an interview. "There is a high likelihood you'll see enforcement actions as well."
The lack of oversight is particularly thorny when brokers funnel trades to exchanges that pay them rebates for the business, Finra said. That practice can create a conflict of interest for the broker.
Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.
Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
- Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events
- Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
