- In the event of a registered representative’s departure, the member firm should promptly and clearly communicate to affected customers how their accounts will continue to be serviced; and
- The firm should provide customers with timely and complete answers, if known, when the customer asks questions about a departing registered representative.
On April 5, 2019, FINRA provided guidance on customer communications related to departing registered representatives. The full text of the Regulatory Notice can be found here: FINRA Regulatory Notice. Member firms and registered representatives need to be aware of this development as it will have a significant impact on departures by registered representatives for rival firms. According to the Notice: “FINRA has consistently sought to ensure that customers can make a timely and informed choice about where to maintain their assets when their registered representative … leaves a member firm.” Therefore, according to the Notice, FINRA expects the following: