Date: December 1, 2014
Issue: FINRA Requests Comment on a Rule Proposal to Implement the Comprehensive Automated Risk Data System
To: Financial Industry Regulatory Authority
Filing Type: Regulatory
Description: While the CCMC appreciates the open and transparent process by which FINRA is soliciting public feedback on CARDS, we continue to have serious concerns over this initiative, and would refer FINRA to our March 2014 comment letter in response to the CARDS Concept Proposal.1 We believe that FINRA has still failed to provide a clear definition and quantification of the problem that CARDS is meant to address, and that the Proposal lacks an adequate explanation as to why the current system of data collection hinders FINRA’s ability to regulate broker-dealers and carry out its mission. We also continue to have very serious concerns regarding the potential costs of implementing CARDS, particularly if―as the Proposal contemplates―some broker-dealers will be forced to hire third party vendors in order to assist them with compliance. Such costs will undoubtedly end up being passed on to customers of broker-dealers and the investing public.