Finra launches exam sweep of business development companies
One area the regulator is focusing on is brokers who have selling agreements with each BDC
Aug 4, 2016 @ 1:46 pm | By Mark Schoeff Jr. | Investment News
Finra has launched an examination sweep of nontraded business development companies, the latest alternative investment product to receive increased scrutiny from the broker-dealer regulator.
In an exam letter posted on its website Thursday, the Financial Industry Regulatory Authority Inc. said it is requesting a list of BDCs offered by Finra members as well as a list of the brokers who have selling agreements with each BDC.
The organization also is seeking a copy of the firms’ due diligence procedures for evaluating the BDC and participating brokers.