FINRA Proposes Fee Increase for Member Firms
The Financial Industry Regulatory Authority (FINRA), the self- regulator who oversees brokers and brokerage firms, has proposed a phased fee increase for firms, aiming to generate an additional $450 million annually by 2029, according to a proposal filed on November 8th, 2024. Submitted to the SEC for approval, the plan includes annual fee hikes of 5.3%, with over 90% of the increases taking effect by 2026 or later.
FINRA reportedly oversees almost 630,000 registered individuals and 3,300 member firms. It must obtain SEC approval before implementing the new fee schedule.
The higher fees, designed to offset rising operational costs, will impact firms differently based on size. Firms with fewer than 10 representatives would pay $625 more annually, while large firms could face an average increase of $415,000. The adjustments will cover regulatory functions, services, and growing expenses tied to technology, wages, and staff.
FINRA cited its relatively modest 41% cost increase from 2013 to 2023, compared to a 129% rise in the broader financial industry. This follows a 2022 fee hike aimed at raising $225 million.
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Last modified: November 19, 2024
