Regulatory Alerts2024-10-23 | Regulatory Notice 24-12Added · Updated
FINRA Adopts Amendments to Rule 3240
FINRA has adopted amendments to Rule 3240, strengthening the general prohibition on borrowing and lending between registered persons and customers by extending coverage to pre-existing relationships and those within six months of termination. The rule modernizes the "immediate family" definition, narrows the personal and business relationship exceptions, and mandates written notice and firm approval for most permissible arrangements. Member firms are required to perform a reasonable risk assessment and determination for such arrangements, with the amendments becoming effective on April 28, 2025.
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