The Financial Industry Regulatory Authority, the broker-dealer–funded markets monitor, should strengthen its sanction guidelines, especially for second- and third-time offenders, Commissioner Kara M. Stein of the Securities and Exchange Commission, recently said. "Your sanctions should be designed to deter misconduct and improve business standards. And recidivists should be treated more harshly. But, I fear the results, after months or years of hard work by you, are too often financially insignificant for the wrongdoers. Your enforcement cases must be impactful, and provide strong motivation for compliance. I would encourage you to examine your sanctions and update them. I think the [SEC] could be very helpful to you in that process," Stein told some 450 of the 530 employees in FINRA's Division of Market Regulation. The SEC oversees FINRA and must approve its rule amendments before they can become effective, but the amendments must be proposed and approved by FINRA before they can
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