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FINRA ponders broker bonus disclosure rule

Nov 30 2012 Suzanne Barlyn, Reuters

Wall Street's industry-funded watchdog is discussing a possible rule that would require securities brokerages to tell certain customers about compensation offered to brokers for moving to their firms. The proposal is on the agenda for discussion at the Financial Industry Regulatory Authority's Board of Governors meeting, set for Dec. 6, according to FINRA's website. FINRA is considering the proposal as it also takes a broader look at conflicts of interest at brokerages. The regulator is collecting information from 14 brokerages about how they are managing conflicts, including compensation that may motivate brokers to push certain securities to investors, said Susan Axelrod, head of FINRA's member regulation unit, at an industry conference last month. Among the concerns, Axelrod said in October, are that brokers who receive large financial incentives to move to a different firm may promise their clients new and better securities products for bringing their assets to

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