FINRA just clarified a question that has been a thorn in the side for many outsourced FINOPs and their broker-dealer clients for many years: Are FINOPs required to make on-site inspections of their clients’ records to fulfill their regulatory duties?
The short answer: No.
The SEC recently provided non-carrying broker dealers with an alternative option as to how they can maintain their exemptive status under SEC Rule 15c-3-3.
ACI Managing Partner, Jay Gettenberg, has worked closely with the Public Company Accounting Oversight Board (PCAOB) and FINRA in recent years to address the practical reality that there are FINRA member firms who do not hold customer funds, yet do not technically qualify under any of the four exemptions listed on the X-17A-5 Focus Report.
The SBA-backed Paycheck Protection Program (PPP) reopened on April 27, 2020 with $320 billion in additional funding.
More than 75% of ACI’s clients who have applied under PPP have obtained official SBA loan numbers this past week.
The window is now open for businesses to apply for SBA-backed Paycheck Protection Program loans under the $2.2 trillion CARES Act.
ACI is sharing relevant sections of FINRA’s guidance regarding the net capital treatment of covered loans.