Table of Contents
SERIES 24 | FINANCIAL REGULATION COURSES
FINRA Rule 9268 governs the Hearing Panel's written decision — the formal adjudicative output that determines whether the respondent violated any charged rule provision, imposes sanctions where violations are found, and initiates the process through which the decision either becomes final disciplinary action or proceeds to appellate review. The rule establishes the 60-day decision drafting window measured from the final post-hearing briefing date, the seven required content elements of every decision, the 65-day dissenting opinion window, the service and dissemination requirements that broadcast the decision to the parties and through the CRD system, the finality provision that makes an unappealed decision the final disciplinary action of FINRA, and the sanctions effectiveness framework governing when specific sanctions take effect. Together these provisions define the complete lifecycle of the Hearing Panel's decision from drafting through finality — the moment when FINRA's formal charging process culminates in either a binding adjudicative outcome or the initiation of appellate review.
FINRA Rule 9268 sits within the 9260 Hearing and Decision 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-99-76 effective September 11, 2000, amended by SR-FINRA-2008-021 effective December 15, 2008, amended by SR-FINRA-2011-044 effective March 30, 2012, amended by SR-FINRA-2013-018 effective December 16, 2013 as announced in Regulatory Notice 13-27, and most recently amended by SR-FINRA-2015-019 effective November 2, 2015 as announced in Regulatory Notice 15-35 — which added paragraph (b)(7) requiring that decisions imposing permanent cease and desist orders include a statement consistent with FINRA Rule 9291(a)'s content, scope, and form requirements. Five selected notices are associated with the rule — 00-56, 08-57, 12-12, 13-27, and 15-35.
FINRA Rule 9268(a) establishes the decision drafting framework and its primary timeline. Within 60 days after the final date allowed for filing proposed findings of fact, conclusions of law, and post-hearing briefs pursuant to FINRA Rule 9266, the Hearing Officer shall prepare a written decision that reflects the views of the Hearing Panel or Extended Hearing Panel as determined by majority vote.
The 60-day decision drafting window begins running from the final post-hearing briefing date — the conclusion of the FINRA Rule 9266 briefing process, not the date of the hearing itself. The sequential timeline of FINRA Rule 9266's 60-day briefing window followed by FINRA Rule 9268's 60-day decision drafting window creates a total post-hearing period of up to 120 days from the conclusion of the hearing to the issuance of the Hearing Panel's decision under the default standards. The Chief Hearing Officer has discretionary authority to establish a different date — acknowledging that complex multi-respondent cases may genuinely require more time and that straightforward cases may be resolved much faster.
The Hearing Officer prepares the written decision pursuant to FINRA Rule 9235(a)(7)'s authority — but the decision reflects the Panel majority's views as determined by collective deliberation and majority vote, not the Hearing Officer's individual analysis. The Hearing Officer is the draftsperson and the presiding officer; the Panel is the decision-maker. In a case where the Hearing Officer and one Panelist agree and the other Panelist dissents, the majority decision reflects the Hearing Officer and agreeing Panelist's conclusions, and the dissenting Panelist may write a separate dissenting opinion under FINRA Rule 9268(c).
FINRA Rule 9268(b) specifies seven required content elements that every Hearing Panel decision must include. These requirements ensure that the decision is a complete, reasoned adjudicative document — not merely a pronouncement of outcome — that provides the respondent with a full explanation of the findings and conclusions against them and provides the foundation for meaningful appellate review.
The first required element — a statement describing the investigative or other origin of the disciplinary proceeding if not otherwise contained in the record — places the decision in institutional context. A reader of the decision who was not present for the proceedings should be able to understand from the decision itself how the disciplinary case began — whether from a routine examination, a customer complaint, a regulatory referral, a self-report, or other investigative source. This contextual statement is required only if not otherwise contained in the record, recognizing that some proceedings have a well-documented origin that is already part of the official record.
The second required element — the specific statutory or rule provisions that were alleged to have been violated — identifies the precise regulatory basis for the charges. A decision that does not clearly identify which rules were charged provides inadequate notice to the respondent and inadequate guidance to appellate bodies. The statutory or rule provisions statement must be specific enough to enable the respondent and appellate bodies to assess whether the charged provisions apply to the alleged conduct.
The third required element — a statement setting forth the findings of fact with respect to any act or practice the respondent was alleged to have committed or omitted — is the factual core of the decision. Every material factual finding must be stated, grounded in the evidence of record pursuant to FINRA Rule 9266(b)'s record citation requirement, and sufficiently detailed to enable the respondent to understand which specific alleged conduct was found to have occurred and which was not. The findings of fact are the foundation of appellate review — the NAC and SEC assess whether the findings are supported by substantial evidence in the record as a whole and whether they support the legal conclusions that follow.
The fourth required element — the conclusions of the Hearing Panel as to whether the respondent violated any provision alleged in the complaint — is the legal determination: guilty or not guilty on each charged cause of action. Every cause of action must be addressed — the decision must determine whether each charged rule was violated, not merely pronounce a global guilty or not guilty finding. A cause of action that is not addressed in the conclusions leaves the respondent and appellate bodies uncertain about the Panel's determination on that charge.
The fifth required element — a statement of the Hearing Panel in support of the disposition of the principal issues raised in the proceeding — is the analytical reasoning that explains the Panel's conclusions. The analytical support statement is the most intellectually demanding element of the required content — it must explain why the Panel found or did not find violations on the principal issues, engaging with the key legal and factual arguments raised by the parties. Published OHO decisions provide extensive examples of this analytical requirement — Hearing Panel decisions typically include multi-page analyses of the factual record, the applicable legal standards, and the application of those standards to the found facts.
The sixth required element — a statement describing any sanction imposed, the reasons therefor, and the date upon which the sanction shall become effective — addresses the penalties imposed for any violations found. Every sanction must be specifically described, grounded in the FINRA Sanction Guidelines' analytical framework, and assigned an effective date. The March 2024 Sanction Guidelines establish the framework within which Hearing Panels determine appropriate sanctions — aggravating and mitigating factors, principal considerations for each violation type, ranges of appropriate fines, and the factors supporting bars versus suspensions — and the FINRA Rule 9268(b)(6) reasons therefor requirement means that the sanction analysis must explain how the Guidelines were applied to the specific facts of the case.
The seventh required element — added by SR-FINRA-2015-019 effective November 2, 2015 — is a statement consistent with FINRA Rule 9291(a)'s content, scope, and form requirements when the sanctions include a permanent cease and desist order. FINRA Rule 9291(a) requires that a permanent cease and desist order specifically order the respondent to cease and desist from violating a specific rule or statutory provision, describe the conduct with reasonable specificity, and set forth the acts to be taken or refrained from. The 2015 amendment to FINRA Rule 9268 ensures that every decision imposing a PCDO complies with FINRA Rule 9291(a)'s requirements — preventing imprecise or overly broad PCDO language that would create enforcement uncertainty.
FINRA Rule 9268(c) provides that within 65 days after the final post-hearing briefing date — five days longer than the majority decision window — the Hearing Officer or any Panelist may prepare a written dissenting opinion. The five additional days beyond the majority decision window accommodate the practical reality that a dissenting opinion is typically written in response to the majority's completed decision — the dissenter needs to see the majority's reasoning before crafting the most focused and effective dissent.
Dissenting opinions are a recognized and valued feature of FINRA's adjudicative system. Published OHO decisions include dissents on significant cases, and the existence of a principled dissent may strengthen a respondent's appellate arguments by identifying issues on which reasonable adjudicators disagree. A Panelist who would have found no violation, or who would have imposed a materially different sanction, may write a dissenting opinion explaining their view — creating a record of the principled disagreement that the NAC and SEC may find informative in appellate review.
FINRA Rule 9268(d) establishes the dissemination obligations that ensure the Hearing Panel's decision reaches all relevant recipients promptly. OHO shall promptly serve the decision and any dissenting opinion on the parties pursuant to FINRA Rule 9132 — the Adjudicator-issued document service rule. OHO shall publish notice of the decision and any dissenting opinion in the Central Registration Depository — the CRD that underlies BrokerCheck and serves as the central repository of registration and disciplinary information about FINRA members and associated persons. And OHO shall provide a copy to each FINRA member with which a respondent is associated — ensuring that the respondent's current employer receives immediate notice of the disciplinary decision and can take appropriate supervisory action.
The CRD publication requirement connects FINRA Rule 9268 to FINRA Rule 8312's BrokerCheck disclosure framework — Hearing Panel decisions become part of the public record accessible through BrokerCheck upon CRD publication. The employer notification requirement serves the supervisory oversight function — a member firm employing a respondent who has been found to have violated FINRA rules and sanctioned must know about that decision to implement appropriate heightened supervision under FINRA Rule 9285 if applicable and under the firm's general supervisory obligations.
FINRA Rule 9268(e) establishes the conditions under which a Hearing Panel decision becomes final disciplinary action of FINRA for purposes of SEA Rule 19d-1(c)(1) — the Exchange Act rule governing FINRA's obligation to report disciplinary actions to the SEC. The decision becomes final if not timely appealed pursuant to FINRA Rule 9311 or timely called for review pursuant to FINRA Rule 9312. The twenty-five-day appeal period under FINRA Rule 9311 runs from service of the Hearing Panel decision. If neither an appeal nor a call for review is filed within the applicable periods, the Hearing Panel's majority decision stands as FINRA's final disciplinary action.
The finality concept connects FINRA Rule 9268 to the entire downstream enforcement framework. A final disciplinary action triggers FINRA's SEA Rule 19d-1(c)(1) reporting obligation — FINRA must report the final action to the SEC. A final disciplinary action also triggers the sanctions effectiveness provisions of FINRA Rule 9268(f) — sanctions take effect only upon finality. And a final disciplinary action is the event from which FINRA's public disclosure obligations under FINRA Rule 8313 flow.
FINRA Rule 9268(f) establishes the default sanctions effectiveness rules for decisions that have become final disciplinary action. Two distinct standards apply depending on the severity of the sanction.
For sanctions other than a bar or an expulsion — fines, suspensions, conditions, and other sanctions — the sanction becomes effective on a date to be determined by FINRA. This staff-determined effective date provides operational flexibility — FINRA can provide the respondent with a brief period to wind down activities, arrange for supervision, or otherwise prepare for the sanction before it takes effect, while ensuring that the sanction does become effective promptly after finality.
For bars and expulsions — the most severe sanctions — the sanction becomes effective immediately upon the decision becoming final disciplinary action of FINRA. The immediate effectiveness of bars and expulsions reflects the investor protection imperative — a person barred from the industry or a firm expelled from FINRA membership must cease their regulated activities the moment the decision is final, without any grace period that would allow continued harm to investors.
The unless otherwise provided in the majority decision qualifier preserves the Panel's ability to specify a different effective date in specific circumstances — for example, a delayed effective date for a sanction that would otherwise take effect during a particularly disruptive period for a firm's clients, or an immediate effective date for a non-bar sanction where investor protection concerns warrant expedited effectiveness.
FINRA Rule 9311 provides that an appeal to the NAC from a Hearing Panel decision issued under FINRA Rule 9268 operates as an automatic stay of that decision pending the NAC's ruling — the sanctions do not take effect while the appeal is pending. The one exception to this stay is a decision imposing a permanent cease and desist order, which is not stayed by an appeal under FINRA Rule 9311. This non-stay for PCDOs reflects the same investor protection logic as FINRA Rule 9268(f)'s immediate effectiveness rule for bars — the continuing conduct prohibited by a PCDO is sufficiently harmful that it cannot be permitted to continue during the appellate period.
FINRA Rule 9268 is the culmination of the entire disciplinary proceeding that the preceding rules in the 9260 subsection have structured. FINRA Rule 9235(a)(7)'s authority to draft the majority decision is exercised through FINRA Rule 9268(a). FINRA Rule 9266's post-hearing briefing process establishes the briefing date from which FINRA Rule 9268's 60-day and 65-day windows run. FINRA Rule 9269's default decision parallel is discussed below. FINRA Rule 9270's settlement procedure is an alternative to a FINRA Rule 9268 decision. FINRA Rule 9285's interim orders are imposed by the Hearing Officer after a FINRA Rule 9268 decision is appealed. FINRA Rule 9291's PCDO content requirements are cross-referenced in FINRA Rule 9268(b)(7). And FINRA Rule 9311's appeal right runs from service of the FINRA Rule 9268 decision.
FINRA Rule 9268 is tested on the Series 24 General Securities Principal examination as the Hearing Panel decision rule — one of the most practically important rules in the entire Code of Procedure covering the format, content, timing, dissemination, finality, and sanctions effectiveness of FINRA disciplinary decisions.
The key points to retain are these: FINRA Rule 9268(a) requires the Hearing Officer to prepare the majority decision within 60 days after the final post-hearing briefing date or by a Chief Hearing Officer discretionary date; the decision reflects the Hearing Panel majority's views as determined by majority vote; FINRA Rule 9268(b) requires seven specific content elements — the investigative origin, charged rule provisions, findings of fact, violation conclusions, analytical support for principal issues, sanction description with reasons and effective date, and for PCDOs a statement consistent with FINRA Rule 9291(a) requirements; FINRA Rule 9268(c) permits the Hearing Officer or any Panelist to prepare a written dissenting opinion within 65 days after the final briefing date; FINRA Rule 9268(d) requires OHO to promptly serve the decision on all parties, publish notice in the CRD, and provide copies to each FINRA member employing a respondent; FINRA Rule 9268(e) provides that an unappealed and uncalled-for-review decision becomes final disciplinary action of FINRA for SEA Rule 19d-1(c)(1) purposes; FINRA Rule 9268(f) provides that sanctions other than bars and expulsions become effective on a date FINRA determines while bars and expulsions become effective immediately upon finality; an appeal under FINRA Rule 9311 stays the Hearing Panel decision except for PCDOs which are not stayed; paragraph (b)(7) was added by SR-FINRA-2015-019 effective November 2, 2015; and the rule was last amended November 2, 2015 through SR-FINRA-2015-019 as announced in Regulatory Notice 15-35.
