FINRA Seeks to Reverse Public-Majority Board Structure…
By Abdelaziz Fathi
AI summary of the source article
FINRA has filed a proposal with the SEC to give brokerage industry representatives majority control of its governing board. The plan reduces board size to between 13 and 20 members and extends maximum service terms to nine years.
Why it matters
The proposal would substantially change how the self-regulatory organization is governed and give regulated firms a structural majority in FINRA's highest governing body, while leaving its responsibility for supervising US broker-dealers and protecting investors intact.
Key facts
- FINRA proposed reducing its governing board to between 13 and 20 members, with industry representatives outnumbering public governors.
- The proposal, filed as SR-FINRA-2026-024, reverses a public-majority independence requirement implemented following a 1996 SEC investigation.
- The plan would extend maximum consecutive board service from six to nine years while maintaining an independent majority on the Audit and Risk Committee.
Source excerpt · FinanceFeeds
FINRA Proposes Industry-Majority Board, Reversing 1996 Reform The Financial Industry Regulatory Authority (FINRA) has proposed giving brokerage industry representatives majority control of its governing board, reversing an independence requirement introduced in 1996 after a Securities and Exchange Commission (SEC) investigation found serious conflicts in its predecessor's oversight of Nasdaq. The…