As discussed in our March 2019 Regulatory Update, FINRA issued Regulatory Notice 19-04 to encourage FINRA members to review how they supervised sales of 529 plan shares since January 2013 and report their conclusions to the self-regulatory agency. FINRA just issued a Frequently Asked Questions Regarding the 529 Plan Share Class Initiative, extending the deadline for self-reporting included in Regulatory Notice 19-04. Participating firms have until April 30, 2019 (extended from April 1) to provide FINRA Enforcement with notice of their intent to self-report, and then must confirm their eligibility by submitting the additional information required by May 31, 2019 (extended from May 3, 2019). Firms can also request extensions to these deadlines via email at email@example.com.
To be eligible for relief provided by the Initiative, firms must: (1) voluntarily self-report to FINRA any potential violations regarding the supervision and suitability of share class recommendations to customers of 529 Savings Plans; and (2) confirm eligibility by submitting certain required information for the disclosure period, January 1, 2013 through June 30, 2018.
New Due Dates:
- Tuesday, April 30, 2019 – Firms that want to self-report must submit written notification to FINRA via email to firstname.lastname@example.org by April 30 or via mail to “529 Plan Initiative, FINRA, Department of Enforcement, Brookfield Place, 20 Liberty Street, New York, New York 10281.”
- Extension Requests – Firms can request extensions to the April 30 and May 31 deadlines via email to email@example.com.
- Friday, May 31, 2019 – Firms that have not received an extension must confirm eligibility by submitting to FINRA and provide the information outlined on page 4 of Regulatory Notice 19-04. Firms that cannot meet this deadline may request an extension from FINRA.
To help you make the self-reporting decision, we have assembled a checklist of factors to consider when assessing deficiencies in your firm’s supervisory system. Contributed by Jaqueline M. Hummel, Partner and Managing Director