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FINRA Revives Broker Bonus Disclosure Plan

This week, FINRA’s board will take up the issue of whether advisors will be required to report bonuses received when switching broker dealers. The issue had been on the agenda for their July board meeting, but scheduling delayed its consideration. FINRA said this:

The board will consider an updated proposal to require disclosure of compensation a registered representative receives in connection with changing firms and other important considerations for a customer deciding whether to follow the representative to the new firm.

The disclosure is considered to be important to a client that’s trying to decide whether to move with their advisor to a new broker dealer. It’s uncertain whether such a disclosure would dampen broker movement, or whether it would affect the number of clients who choose not to move to their advisor’s new firm.

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