Board Approved 2026 Budget, Rule Proposals for Electronic Delivery and Customer Protection from Financial Exploitation

WASHINGTON: FINRA’s Board of Governors held its final meeting of the year Dec. 10-11. The Board approved three rule proposals. It also reviewed FINRA’s 2025 financial performance and approved FINRA’s 2026 budget. More information about FINRA's finances will be provided in FINRA’s annual financial report and budget summary.

Rulemaking

The three rule proposals reflect feedback FINRA has received on the rule modernization effort that is part of FINRA Forward, a series of initiatives to improve FINRA’s effectiveness and efficiency in pursuing its mission of protecting investors and safeguarding market integrity.

“The Board’s approval of these three rule proposals reflects FINRA’s commitment to modernizing our regulatory framework while strengthening investor protections for an evolving marketplace. By enabling electronic delivery as a default option, we’re aligning our rules with how many investors prefer to receive information in the digital age. Our enhanced safeguards against financial exploitation demonstrate our determination to protect vulnerable investors, particularly seniors, from fraud and abuse. And by updating our new issue rules for collective trust funds, we’re ensuring retirement savers have equitable access to investment opportunities,” said FINRA Board Chair Scott Curtis.

The three rule proposals are:

• Electronic Delivery Default: The Board approved a proposal to permit member firms to use electronic delivery as the default means of providing information to customers under FINRA rules. The proposal supports modern communication practices and preferences while preserving customers’ ability to choose paper delivery. FINRA plans to file the proposed rule changes with the SEC and publish related guidance in a Regulatory Notice.
• Customer Protection from Financial Exploitation: The Board approved a proposal that would better equip member firms to protect customers from financial exploitation. The proposal includes amendments to boost the adoption and usefulness of customers' trusted contacts and allow member firms greater flexibility to extend temporary holds when they reasonably suspect financial exploitation of a senior or vulnerable adult. It would also offer member firms a new optional shorter temporary hold (a “speed bump”) to protect customers of any age from suspected fraud. FINRA will issue a Regulatory Notice seeking comment on the proposal.
• Collective Trust Fund Flexibility: The Board approved a proposal that would provide more flexibility for collective trust funds-sometimes referred to as collective investment trusts- to receive initial public offering allocations under FINRA’s new issue rules. The exemption would treat these pooled investment vehicles, which are generally used as investment options in qualified retirement plans, comparably to other types of pooled investments. FINRA plans to file the proposal with the SEC.

Additional Updates

The Board received an update on FINRA’s 2026 Regulatory Oversight Report, a key resource for member firms with insights from FINRA’s regulatory operations programs, including findings and best practices.

The Board also received an update on the ongoing external review of FINRA’s enforcement program, as well as the enhancements being made to FINRA’s organizational structure to align with the demands of FINRA’s mission. This includes the ongoing work to operationalize two new groups: Regulatory Operations and Market and Regulatory Services.

The Board also met with Investment Company Institute President and CEO Eric Pan, who joined the meeting to discuss issues that are top of mind for the asset management industry, including exchange-traded fund share classes of mutual funds.

More information about the Board's operations, including membership and responsibilities of its committees, is available here.

In related news, FINRA announced the winners of the recent Small Firm Advisory Committee (SFAC) and Regional Committee elections, as well as those who were appointed to serve on the SFAC and the National Adjudicatory Council. Visit FINRA’s year-end Election Notice for the full list of winners and appointees.

About FINRA

FINRA is a not-for-profit organization dedicated to investor protection and market integrity. FINRA regulates one critical part of the securities industry-member brokerage firms doing business in the U.S. FINRA, overseen by the SEC, writes rules, examines for, and enforces compliance with FINRA rules and federal securities laws, registers broker-dealer personnel and offers them education and training, and informs the investing public. In addition, FINRA provides surveillance and other regulatory services for equities and options markets, as well as trade reporting and other industry utilities. FINRA also administers a dispute resolution forum for investors and brokerage firms and their registered employees. For more information, visit www.finra.org

Fonte: Business Wire