Brokerdealers must stay on their toes amid coronavirus: Finra


On Monday, the Financial Industry Regulatory Authority Inc. encouraged the 3,600 broker-dealers it oversees to dust off their business continuity plans as the coronavirus continues to spread.

Finra last gave its members guidance on how to operate during an outbreak of a severe illness during the swine flu outbreak in 2009.

In the context of a pandemic, broker-dealer firms should consider having employees and financial advisers working in remote or backup offices or from home, according to Finra’s notice to members Monday. They should remember to inform Finra if they make such arrangements, the regulator said, and be on the lookout for additional cybersecurity events such as phishing.

“The risk of cyber events may be increased due to use of remote offices or telework arrangements, heightened anxiety among associated persons and confusion about the virus,” according to Finra.

Finra also urged broker-dealers to remain focused on their clients, an increased number of whom may call or use their online accounts given the large moves in the markets.

Broker-dealers “are encouraged to review their [business continuity plans] regarding communicating with customers and ensuring customer access to funds and securities during a significant business disruption,” Finra’s notice stated. “If registered representatives are unavailable to service their customers, member firms are encouraged to promptly place a notice on their websites indicating to affected customers who they may contact concerning the execution of trades, their accounts, and access to funds or securities.”

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