SEC Approves FINRA Rule Governing Sales Practices of Deferred Variable Annuities
October 01, 2007
The Securities and Exchange Commission ("SEC" or "Commission") recently approved a new Rule 2821 (the "Rule"), proposed by the Financial Industry Regulatory Authority ("FINRA," formerly the National Association of Securities Dealers, Inc. "NASD") relating to broker-dealer sales practices with respect to purchases and exchanges of deferred variable annuities. The Rule will create specific requirements governing broker-dealer transaction recommendations, which include a suitability obligation, principal review and approval criteria, and supervisory training requirements and procedures, all customized for certain deferred variable annuity transactions. The SEC approved the Rule on an accelerated basis.
