CCO Action Alert: Following FINRA Suitability Rule Guidelines
Suitability obligations are critical to investor protection. FINRA Suitability Rule Guidelines are included in Rule 2111 and FINRA Rule 3110. These two rules state that brokerage firms must ensure investment recommendations, including options and private placements, are suitable according to each client’s individual profile. Failure to verify customer suitability, monitor account activity, and investigate investments like private placements can result in meaningful penalties.