FINRA Rule 3120 requires broker-dealers to maintain a risk-based supervisory control system that annually tests and verifies the effectiveness of the firm's written supervisory procedures (WSPs).
Syndicate Legal Advisory Services provides nationwide legal document preparation services for broker-dealer firms required to prepare the annual report under FINRA Rule 3120 regarding the firm’s system of supervisory controls. We prepare the report and related supporting materials based on the descriptions of the supervisory control system, test results, exceptions, procedural changes, and specific instructions you provide.
Documents Commonly Prepared
We prepare a full range of documents associated with the Rule 3120 Annual Supervisory Control System Report, including but not limited to:
- Annual Report: Completion of the report detailing the firm’s system of supervisory controls, the summary of the test results and significant identified exceptions, and any additional or amended supervisory procedures created in response to the test results, based on the information and descriptions you supply.
- Additional Content for Larger Firms: Formatting of the additional required elements for firms that reported $200 million or more in gross revenue (as defined in the rule) in the prior calendar year, including a tabulation of reports pertaining to customer complaints and internal investigations made to FINRA during the preceding year, and a discussion of the preceding year’s compliance efforts (including procedures and educational programs) in the specified areas (trading and market activities, investment banking activities, antifraud and sales practices, finance and operations, supervision, and anti-money laundering), to the extent applicable and based on the content you provide.
- Supporting Summaries and Schedules: Organization of test result summaries, exception lists, or related schedules from the details you provide.
- Related Supporting Materials: Organization of exhibits or attachments incorporating client-supplied testing documentation, procedural amendments, or other materials referenced in the report.
Documents are prepared for the firm’s internal use and submission to senior management as required by Rule 3120 (subject to the information you provide). The report must be submitted no less than annually by the designated principal(s); for new members, the first report must be completed within 12 months of becoming a FINRA member; clients remain fully responsible for the accuracy of the underlying testing and verification, the content of the report, timely submission to senior management, and compliance with all FINRA Rule 3120 requirements.
