Representing financial professionals, financial institutions and investors in investment loss, employment and disclosure matters, and in regulatory investigations nationwide.

FINRA amends rules allowing for video conference hearings

On Behalf of | Aug 24, 2023 | FINRA Compliance

The Financial Industry Regulatory Authority has notified member firms of amended rules pertaining to video conference hearings.

In Regulatory Notice 23-13, taking effect this week, FINRA said it would be allowing the video hearings before the Office of Hearing Officers (OHO) and the National Adjudicatory Council (NAC) under specified conditions.

Due to the health risks of the COVID-19 pandemic, temporary amendments allowed OHO and NAC to order, without a motion, hearings to proceed by video conference.  The new rule changes make those amendments permanent, with some modifications.

OHO’s and the NAC’s authority to order hearings by video conference will now extend beyond the public health risks posed by COVID-19 to similar situations in which in person hearings might endanger the health or safety of the participants or would be impractical, for example in the event of a natural disaster or terrorist attack that caused travel to be cancelled for a period of time. The amended rules also permit OHO and the NAC to order a hearing to proceed by video conference based on a motion filed by one or both parties, as applicable.

But FINRA noted that in-person proceedings remain the default method for conducting hearings.

OHO conducts hearings in disciplinary proceedings and hearings for temporary and permanent cease and desist orders, while the NAC conducts hearings in membership proceedings, eligibility proceedings, and Funding Portal eligibility proceedings.

Under the amended rules, FINRA said OHO and the NAC have reasonable discretion to exercise their authority to order a hearing by video conference. They may consider a variety of factors, including a hearing participant’s individual health concerns and access to the connectivity and technology needed to take part in a video conference hearing.

The attorneys at Lewitas Hyman understand the complexities that come with being the subject of a regulatory inquiry by the SEC, FINRA, and other self-regulatory organizations, and we have the experience to guide and advise you through any type of regulatory investigation. If you are the subject of a regulatory proceeding, contact us at (888) 655-6002 or through our online contact form for a free consultation.