Bond Dealers Required to Report Retail Markups in Finra Plan
- Brokerage regulator moves to crack down on abusive commissions
- Rule subject to Securities and Exchange Commission approval
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Brokers would have to reveal how much they earn on bond transactions that involve retail clients under a U.S. regulator’s plan for cracking down on inflated commissions.
The Financial Industry Regulatory Authority proposal, if approved by the Securities and Exchange Commission, would force brokers to report markups on bonds they hold for no more than one day, according to a statement released Friday. The requirement would close a loophole that allows brokers avoid disclosing markups on bond sales, while commissions on stock trades have to be reported.