Continued SEC/FINRA “Complex” Product Concerns: Will Good Regulatory Harvest Arrive?
SEC Awards Whistleblower Whose Tip Led to Opening of Investigation
May 25, 2022
Finfluencers Attracting Finra’s Attention
May 25, 2022
Like farmers uncertain about what crop to plant, the SEC and FINRA continue to cast about for ways to enhance their regulatory framework for “complex” products, particularly with regard to retail investor understanding. The regulators have been hampered by, among other things, the lack of any clear and consistent definition of what products should be regarded as “complex” for purposes of any such regulatory initiative.
In October 2021, the SEC approved rule changes by Cboe BZX Exchange Inc. to list and trade two complex exchange-traded products (ETPs). The next week, SEC Chair Gary Gensler issued a statement on complex ETPs in which he called for additional rulemaking to strengthen the investor protections around those products.
