Close X
Attorney Spotlight

Find out which two countries Cheryl Palmeri gets the most questions about related to International Trade in today's market? Find out more>


Close X


Search our Experience

Experience Spotlight

In June 2016, AmSurg Corp. and Envision Healthcare Holdings, Inc. (Envision) announced they have signed a definitive merger agreement pursuant to which the companies will combine in an all-stock transaction. Upon completion of the merger, which is expected to be tax-free to the shareholders of both organizations, the combined company will be named Envision Healthcare Corporation and co-headquartered in Nashville, Tennessee and Greenwood Village, Colorado. The company's common stock is expected to trade on the New York Stock Exchange under the ticker symbol: EVHC. Bass, Berry & Sims served as lead counsel on the transaction, led by Jim Jenkins. Read more.

AmSurg logo

Close X

Thought Leadership

Enter your search terms in the relevant box(es) below to search for specific Thought Leadership.
To see a recent listing of Thought Leadership, click the blue Search button below.

Thought Leadership Spotlight

Inside the FCA blogInside the FCA blog features ongoing updates related to the False Claims Act (FCA), including insight on the latest legal decisions, regulatory developments and FCA settlements. The blog provides timely updates for corporate boards, directors, compliance managers, general counsel and other parties interested in the organizational impact and legal developments stemming from issues potentially giving rise to FCA liability.

Read More >

$300,000 Regulatory Settlement Highlights Firms' Supervisory and U4 Reporting Obligations

Firm Publication


March 8, 2016

A member firm's culture of compliance must include procedures designed to ensure the firm's associated persons' CRD filings are timely, accurate and complete. FINRA By-Laws require associated persons to promptly disclose to FINRA reportable U4 and U5 events, including, but not limited to, regulatory actions, customer complaints, bankruptcy filings, liens, judgments and criminal charges.1 Rule 3010 has long required firms to maintain WSPs "reasonably designed to achieve compliance" with applicable laws and rules, including keeping associated persons' U4/U5 filings current. 

In 2014, as part of its efforts to ensure associated person compliance and increase transparency, FINRA began making sweeping changes to its supervision rules, amending Rule 3010 (and renumbering it as Rule 3110) to require member firms to verify the accuracy and completeness of their associated persons' U4 disclosures.2 The changes were highlighted in FINRA's 2015 Regulatory and Examinations Priorities Letter and required member firms to "establish and implement written procedures reasonably designed to verify the accuracy and completeness of the information contained in" the U4s of new applicants and experienced associated persons moving their registrations to new firms.3 On a parallel track, FINRA examined public financial records for all registered persons and also notified "a handful of firms" that it had "flagged cases where a firm's brokers had liens and judgments that were never reported."4

The gravity of failing to meet this disclosure-related obligation is apparent in last week's announcement by FINRA of a $300,000 settlement with, and censure of, RBC Capital Markets, LLC ("RBC").5 FINRA found: (1) "RBC Failed to Amend and Timely Amend Firms U4 to Report Unsatisfied Liens and Judgments;" and (2) "RBC Failed to Establish a Supervisory System to Review Wage Garnishment Orders for Reportable Events." The findings stem from the firm's receipt of 71 wage garnishment orders among its 5,300 registered representatives during a 2 ½ year period and its failure to "conduct a sufficient inquiry to determine if the underlying event … should have been reported on the affected individual's Form U4." In 26 instances the required amendment was never filed, and in another 15 instances the amendment was untimely. FINRA also found the firm did not have sufficient WSPs governing the review of wage garnishment orders so the firm could determine if the garnishment involved a reportable event and take appropriate disclosure steps as required.

This action serves as a reminder that firms must adopt and implement reasonable procedures to verify that their associated persons' disclosures are timely, accurate and complete.

1 See FINRA By-Laws Article V, Section 2(c) and Form U4
4 FINRA Going After Firms For Unreported Judgments, Liens by Megan Leonhardt, (March 16, 2015), available at

Related Professionals

Related Services


Visiting, or interacting with, this website does not constitute an attorney-client relationship. Although we are always interested in hearing from visitors to our website, we cannot accept representation on a new matter from either existing clients or new clients until we know that we do not have a conflict of interest that would prevent us from doing so. Therefore, please do not send us any information about any new matter that may involve a potential legal representation until we have confirmed that a conflict of interest does not exist and we have expressly agreed in writing to the representation. Until there is such an agreement, we will not be deemed to have given you any advice, any information you send may not be deemed privileged and confidential, and we may be able to represent adverse parties.