Table of Contents
SERIES 24 | FINANCIAL REGULATION COURSES
FINRA Rule 9241 governs the pre-hearing conference — the central case management tool through which the Hearing Officer organizes, structures, and prepares every FINRA disciplinary proceeding for hearing.
The rule establishes the Hearing Officer's discretionary authority to order conferences on their own motion or at party request, the eleven subjects that may be addressed, the mandatory recording of pre-hearing conferences by court reporter, the requirement that every conference result in a written order or ruling capturing all agreements and determinations, the mandatory scheduling of expedited proceedings at the pre-hearing conference when FINRA Rule 9290 applies, the default consequences for a party's failure to appear, and the authority to request argument on pending motions and address other matters that may aid in the disposition of the proceeding.
Together these provisions make the pre-hearing conference the primary vehicle through which the Hearing Officer exercises FINRA Rule 9235(a)(1)'s authority to hold conferences and require attendance of representatives with settlement authority — transforming the abstract authority into a structured case management process with defined subjects, recorded proceedings, and binding written orders.
FINRA Rule 9241 sits within the 9240 Pre-Hearing Conference and Submission subsection of the 9200 Disciplinary Proceedings section of the 9000 Code of Procedure series. It was adopted by SR-NASD-97-28 effective August 7, 1997, amended by SR-NASD-97-81 effective January 16, 1998, amended by SR-NASD-99-76 effective September 11, 2000, amended by SR-FINRA-2008-021 effective December 15, 2008, and most recently amended by SR-FINRA-2011-044 effective March 30, 2012 as announced in Regulatory Notice 12-12 — which added the designation of investigative testimony transcripts as an additional permissive subject for pre-hearing conferences. Three selected notices are associated with the rule — 00-56, 08-57, and 12-12.
FINRA Rule 9241(a) is the subsection title provision — Pre-Hearing Conference — announcing the subject matter of the rule and establishing it as the governing provision for the pre-hearing conference phase of disciplinary proceedings. This header provision confirms that all pre-hearing conference activity is governed by FINRA Rule 9241's framework, applying the FINRA Rule 9110(a) general applicability principle to anchor conference procedure in this specific rule.
FINRA Rule 9241(b) establishes the procedural mechanics for ordering a pre-hearing conference. On their own motion or at the request of a party, the Hearing Officer may in their discretion order counsel or any party to meet for a pre-hearing conference. The may formulation confirms that pre-hearing conferences are not mandatory in every case — the Hearing Officer exercises discretion about whether a conference is necessary given the complexity of the case, the nature of the charges, the parties' apparent degree of preparation, and any procedural issues already visible from the pleadings.
In practice, however, the initial pre-hearing conference is nearly universal in FINRA disciplinary proceedings. OHO's Guide to the Disciplinary Hearing Process confirms that the initial pre-hearing conference is typically held shortly after the answer is filed, and that at the initial pre-hearing conference the Hearing Officer explains the process to the parties, addresses preliminary matters, and enters an order setting the hearing date and dates for the submission of pre-hearing materials. The Guide also confirms that if the Hearing Officer does not require a pre-hearing conference, a party may ask for one by filing a written motion with OHO — preserving the party's ability to request case management assistance even when the Hearing Officer has not sua sponte ordered a conference.
The remote participation provision — such conferences also may be held with one or more persons participating by telephone or other remote means — reflects FINRA's recognition that disciplinary proceedings may involve parties, counsel, and Hearing Officers in different geographic locations, and that remote participation preserves the efficiency of conference management without requiring in-person assembly. Following the COVID-19 pandemic's operational experience with fully remote proceedings, remote pre-hearing conferences have become common even in cases where in-person hearing attendance will ultimately be required.
FINRA Rule 9235(a)(1)'s attendance requirement — that at least one representative of each party with authority to negotiate the resolution of issues in controversy must attend — applies to pre-hearing conferences ordered under FINRA Rule 9241(b). A party who sends a representative without authority to agree on any issue cannot effectively participate in the narrowing-of-issues function that pre-hearing conferences serve. The attendance requirement ensures that conferences are attended by persons who can actually advance the proceeding's management rather than merely report back to decision-makers who are absent.
FINRA Rule 9241(c) enumerates eleven specific subjects that the Hearing Officer may consider and take action with respect to at a pre-hearing conference. This enumeration is not exhaustive — the rule also confirms the Hearing Officer's authority to request argument on pending motions and consider other matters that may aid in the disposition of the proceeding — but it defines the primary agenda of case management that pre-hearing conferences address.
The first subject — simplification and clarification of the issues — is the threshold case management function. A FINRA disciplinary complaint may allege multiple causes of action across multiple respondents, raising both contested and uncontested factual issues alongside genuinely disputed legal questions. Pre-hearing conference issue simplification identifies which allegations are genuinely contested, which facts may be stipulated, and which legal issues are actually in dispute — focusing the hearing on the genuine points of contention rather than forcing the Panel to hear evidence on matters that are not actually in dispute.
The second and third subjects — exchange of witness and exhibit lists and copies of exhibits — are the mutual disclosure obligations that prevent surprise at hearing. Each party's obligation to disclose the witnesses it intends to call and the exhibits it intends to offer, well in advance of the hearing, enables opposing parties to prepare cross-examination, conduct investigation of disclosed witnesses, and identify potential objections to exhibits before the hearing begins. The Hearing Officer typically sets specific deadlines for these exchanges as part of the Case Management and Scheduling Order issued at the conclusion of the initial pre-hearing conference.
The fourth subject — stipulations, admissions of fact, and stipulations concerning the content, authenticity, or admissibility of exhibits — addresses the formal agreements that parties can reach to streamline the hearing. A stipulation that a specific document is authentic eliminates the need for foundation testimony establishing how the document was created and preserved. A stipulation that certain facts are undisputed eliminates the need for FINRA to prove those facts through witness testimony and documentary evidence. Effective pre-hearing stipulation practice can significantly reduce hearing time and cost for all parties.
The fifth subject — production of documents and witness statements — addresses pre-hearing discovery issues that may not have been fully resolved through the FINRA Rule 9252 discovery process. Outstanding document production disputes, requests for additional witness statement production under FINRA Rule 9253, and related discovery issues can be addressed and resolved at the pre-hearing conference rather than requiring separate motion practice.
The sixth subject — filing and service of papers by the parties — establishes the pre-hearing submission schedule, addressing when parties must file and serve exhibit lists, witness lists, pre-hearing briefs, and pre-hearing submissions under FINRA Rule 9242. The scheduling of these filing deadlines is one of the most operationally important outputs of the initial pre-hearing conference — the deadlines set at the conference govern the entire pre-hearing submission process.
The seventh subject — scheduling of the filing and exchange of pre-hearing motions and briefs — establishes the schedule for any substantive pre-hearing motion practice, including motions for summary disposition under FINRA Rule 9264, motions in limine addressing evidentiary issues, and any other substantive motions that will be briefed and decided before the hearing begins.
The eighth subject — scheduling of a hearing — addresses the setting of the hearing date, time, and location when those have not already been established by the FINRA Rule 9221(d) hearing notice. At the initial pre-hearing conference, the parties typically discuss hearing date availability and logistics, and the Hearing Officer issues a scheduling order establishing the hearing date as part of the CMSO.
The ninth subject — amendments to the complaint or answers — addresses the FINRA Rule 9212(b) and FINRA Rule 9215(d) amendment processes in the pre-hearing conference context. If the Department of Enforcement seeks to amend the complaint or a respondent seeks to amend their answer, the pre-hearing conference provides the procedural vehicle for addressing those requests with all parties present.
The tenth subject — designation of relevant portions of transcripts from investigative testimony or other proceedings and the inclusion of an index for such testimony — was added by SR-FINRA-2011-044 effective March 30, 2012 as announced in Regulatory Notice 12-12. This addition addressed the practical challenge of managing investigative testimony transcripts in disciplinary proceedings — when FINRA Rule 9251's discovery framework makes investigative transcripts available to respondents, the parties and the Hearing Officer need a mechanism for designating which portions are relevant and for creating an indexed reference system that makes the transcripts usable at hearing without requiring all parties to review the complete transcript.
The eleventh subject — consideration of matters which may be admitted into evidence by Official Notice under FINRA Rule 9145(b) — provides the pre-hearing opportunity to identify which facts the Adjudicator may take official notice of, giving parties the FINRA Rule 9145(b)-required opportunity to oppose or comment before official notice is taken.
FINRA Rule 9241(d) establishes the recording requirement for pre-hearing conferences. Unless otherwise ordered by a Hearing Officer, a pre-hearing conference shall be recorded by a court reporter and a transcript shall be prepared. The unless otherwise ordered exception preserves Hearing Officer flexibility to conduct unrecorded conferences for purely administrative matters — scheduling calls and logistical discussions that do not involve substantive case management decisions — without incurring the cost and administrative burden of court reporter engagement.
FINRA Rule 9265 cross-references this recording requirement, confirming that pre-hearing conference transcripts are available for purchase by parties at prescribed rates and that the transcripts are part of the official record under FINRA Rule 9267. The recording of pre-hearing conferences serves several important functions: it creates a reliable record of all agreements reached and orders made that can be consulted if disputes arise about what was decided, it preserves the record for appellate review of any pre-hearing procedural rulings, and it creates the transcript that may be referenced at hearing when pre-hearing orders and stipulations are relevant.
FINRA Rule 9241(e) imposes a mandatory written order obligation — at or following the conclusion of any conference held pursuant to FINRA Rule 9241, the Hearing Officer shall enter a written ruling or order that recites any agreements reached and any procedural determinations made. The mandatory shall confirms that written orders are not optional — every pre-hearing conference must produce a written record of its outcomes. This written order obligation is the operational mechanism through which the Case Management and Scheduling Order is issued — the CMSO that governs the entire pre-hearing process is the written order required by FINRA Rule 9241(e) following the initial pre-hearing conference.
The requirement to recite agreements reached ensures that any stipulations, admissions, or other agreements between the parties are documented in a binding written order rather than remaining as informal verbal understandings. The requirement to recite procedural determinations made ensures that all scheduling decisions, discovery rulings, and other Hearing Officer determinations are memorialized in writing, creating a definitive reference point for all parties throughout the remainder of the proceeding.
FINRA Rule 9241(f) establishes the default consequences for a party's failure to appear at a pre-hearing conference. The Hearing Officer may issue a default decision pursuant to FINRA Rule 9269 against a party that fails to appear, in person or through counsel or a representative, at a pre-hearing conference of which the party has due notice. FINRA Rule 9269 then provides the complete framework for default decisions — including the authority to deem admitted all allegations of the complaint if the defaulting party is the respondent, or to dismiss the complaint with prejudice if the defaulting party is the Department of Enforcement.
The due notice prerequisite is essential — default cannot be entered for failure to appear at a conference of which the party was not properly notified. Service of the pre-hearing conference notice must comply with the 9130 series service framework, and the party must have received adequate notice before the default authority is triggered. FINRA's FAQ for Respondents in Disciplinary Proceedings confirms this directly: if you fail to appear by telephone or video conference for a pre-hearing conference, you may be held in default.
FINRA Rule 9269's additional provision that the Hearing Officer may order a party failing to appear at the pre-hearing conference to pay the costs incurred by other parties in connection with their appearance operates alongside the default authority — the cost-shifting power provides an intermediate sanction for non-appearance that falls short of a full default decision.
The Case Management and Scheduling Order that emerges from the initial pre-hearing conference is the operational backbone of the disciplinary proceeding from complaint through hearing. A typical CMSO addresses discovery deadlines and procedures, pre-hearing submission deadlines and format requirements, the schedule for any pre-hearing motions including summary disposition motions, hearing date and logistics, exhibit submission and binder format requirements, witness disclosure deadlines and formats, and any case-specific procedural requirements the Hearing Officer determines are appropriate for the specific proceeding. OHO Order 23-29 confirmed the enforcement significance of CMSO compliance — the Hearing Officer rejected pre-hearing submissions that did not comply with the CMSO's requirements and granted leave to refile in compliant form, demonstrating that the CMSO's requirements are binding procedural orders, not merely advisory guidelines.
FINRA Rule 9241 implements FINRA Rule 9235(a)(1)'s pre-hearing conference authority in specific operational detail. FINRA Rule 9242's pre-hearing submission requirements are directly triggered by the scheduling orders that FINRA Rule 9241(e) produces — the CMSO establishes the pre-hearing submission deadlines and format requirements that FINRA Rule 9242 governs. FINRA Rule 9265's recording requirement cross-references FINRA Rule 9241(d). FINRA Rule 9267's official record contents include pre-hearing conference transcripts and orders. FINRA Rule 9269's default decision authority is directly invoked by FINRA Rule 9241(f)'s failure-to-appear provision. FINRA Rule 9290's expedited proceeding scheduling requirement — that expedited hearing schedules shall be determined at a pre-hearing conference held in accordance with FINRA Rule 9241 — makes the pre-hearing conference a mandatory step for cases involving concurrent temporary cease and desist proceedings.
FINRA Rule 9241 is tested on the Series 24 General Securities Principal examination as the pre-hearing conference rule — the foundational case management provision that shapes every disciplinary proceeding between answer and hearing.
The key points to retain are these: FINRA Rule 9241 governs the pre-hearing conference through six provisions covering the header, ordering procedure, eleven permissive subjects, recording requirements, the mandatory written order obligation, and default consequences for non-appearance; pre-hearing conferences are ordered at Hearing Officer discretion on own motion or party request and may involve remote participants; the eleven subjects the Hearing Officer may address include issue simplification, witness and exhibit list exchange, stipulations and admissions, document production, filing and service schedules, pre-hearing motion schedules, hearing scheduling, complaint and answer amendments, investigative transcript designation, and official notice consideration; all pre-hearing conferences must be recorded by court reporter unless otherwise ordered; the Hearing Officer must enter a written order following every conference reciting all agreements and procedural determinations — the CMSO is the primary expression of this mandatory written order obligation; a party that fails to appear at a pre-hearing conference of which they had due notice may be held in default pursuant to FINRA Rule 9269 with all complaint allegations deemed admitted; expedited proceedings under FINRA Rule 9290 must have their accelerated hearing schedule determined at a pre-hearing conference; the investigative testimony designation subject was added by SR-FINRA-2011-044 effective March 30, 2012; and the rule was last amended March 30, 2012 through SR-FINRA-2011-044 as announced in Regulatory Notice 12-12.
