U.S. regulator adopts e-filing for enforcement

An adaptation brought on by the pandemic — electronic service and filing of documents in securities industry disciplinary hearings — is being made permanent, the U.S. Financial Industry Regulatory Authority Inc. (FINRA) says.

FINRA said it has adopted changes to its rules to default to email for disciplinary filings and other sorts of hearings.

The self-regulatory organization noted that electronic filing was introduced on a temporary basis due to the pandemic, which resulted in a shift to remote working amid public health restrictions.

Now, FINRA has revised its rules to make these temporary accommodations permanent. It decided that “advances in technology and its availability have made filing and service more efficient under the temporary amendments than under the original rules.”

Additionally, the SRO said the experience of electronic service and filing has demonstrated that it proved to be beneficial for parties to disciplinary hearings, adjudicators and FINRA itself.

While the new default for disciplinary filings is email, FINRA will accommodate other methods where email service is not possible.

Its rules will still not allow for initial complaints to be served electronically — initial service in a disciplinary case must be by hand, mail or courier, it noted.

The new rules take effect on Aug. 22.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.