FINRA Rule 9350

FINRA Rule 9350 sits within the 9300 Review of Disciplinary Proceeding by National Adjudicatory Council and FINRA Board; Application for SEC Review series as the subsection header for the Board review phase. It was adopted as part of the original Code of Procedure by SR-NASD-97-28 effective August 7, 1997 and has been maintained as the subsection header through all subsequent amendments to the rule within it.

The Rule Within FINRA Rule 9350's Subsection

FINRA Rule 9351 — Discretionary Review by FINRA Board — is the single substantive rule within FINRA Rule 9350's subsection. It establishes that a Governor may call a disciplinary proceeding for FINRA Board review within the fifteen-day period prescribed in the rule — a period that begins when the FINRA Board receives the NAC's proposed written decision under FINRA Rule 9349(c) and runs until the next Board meeting falling at least fifteen days after that receipt. 

The fifteen-day period may be shortened to less than fifteen days by unanimous Board vote, or extended to more than fifteen days by majority Board vote during the period. If a Governor calls the proceeding for review within the prescribed period, the FINRA Board shall review the proceeding not later than the next Board meeting. 

The Board may order parties to file briefs — excluding respondents who did not appeal, cross-appeal, or are not subject to the relevant call-for-review issues. After review, the Board may affirm, modify, or reverse the NAC's proposed written decision; may affirm, modify, reverse, increase, or reduce any sanction including PCDO terms; may impose any other fitting sanction; or may remand with instructions.

The FINRA Board's Position in the Appellate Hierarchy

FINRA Rule 9350's subsection organizes the highest level of FINRA's internal appellate review — the FINRA Board itself. The Board's discretionary review authority creates a third tier of internal appellate review above the OHO Hearing Panel and the NAC, but its exercise is rare in practice. 

As the Federal Register filing for the June 2025 rulemaking confirmed, for most matters the NAC considers, its written decision becomes final FINRA action if the FINRA Board does not call the proposed decision for review pursuant to FINRA Rule 9351. The Board's review authority exists as a governance backstop — ensuring that FINRA's ultimate governing body retains oversight of significant disciplinary outcomes — but it is not invoked in routine cases.

When a Governor does call a proceeding for Board review, the Board exercises dispositional authority under FINRA Rule 9351 closely modelled on the authority the NAC exercised under FINRA Rule 9348 — the Board may affirm, modify, or reverse the NAC's proposed written decision or remand the proceeding with instructions, and may affirm, modify, reverse, increase, or reduce any sanction. Unless the Board remands the proceeding, the Board's decision following its review under FINRA Rule 9351 constitutes the final FINRA disciplinary action for SEA Rule 19d-1(c)(1) purposes, superseding the NAC's proposed decision as the outcome of the internal appellate process and triggering the respondent's right to seek SEC review under FINRA Rule 9370.

Connection to FINRA Rules 9144, 9349, 9351, 9360, and 9370

FINRA Rule 9350 connects to FINRA Rule 9144(b) — which specifically prohibits Governors from participating in discussions or decisions relating to the call for review, review, or appeal pursuant to the Rule 9300 series with the Review Subcommittee or the Hearing Officers and Panelists that paragraph names, except that the NAC Chair who is also a Governor is exempt. This separation of functions limitation means that the Board's discretionary review authority must be exercised with careful attention to which Governors are and are not subject to FINRA Rule 9144's restrictions. It connects to FINRA Rule 9349 — whose proposed written decision is the subject of the Board's discretionary review authority. It connects to FINRA Rule 9351 — the single substantive rule within the FINRA Rule 9350 subsection. It connects to FINRA Rule 9360 — whose sanctions effectiveness provisions govern when a Board decision under FINRA Rule 9351 takes effect. And it connects to FINRA Rule 9370 — whose SEC review right is triggered when either the NAC's FINRA Rule 9349 decision becomes final without a Board call, or the Board's FINRA Rule 9351 decision becomes final.

Working Out the Call-for-Review Deadline

The period FINRA Rule 9351 calls the "15 day period" is not a count of fifteen days. A Governor must make the call not later than the next meeting of the FINRA Board that is at least 15 days after the date on which the Board receives the National Adjudicatory Council's proposed written decision. The deadline is therefore a Board meeting, and which meeting it is depends on the Board's calendar.

Suppose the Board receives a proposed decision on 3 March and its next meeting is on 18 March. That meeting falls exactly 15 days after receipt, so it is at least 15 days after receipt, and a call must be made by that meeting. Now suppose instead that the Board's meetings fall on 10 March and 9 April. The 10 March meeting is only seven days after receipt and does not count. The deadline is the 9 April meeting, and a Governor who calls the proceeding on 30 March, twenty-seven days after receipt, has called it in time.

The Board can change the period, but the two directions need different votes. Shortening it to less than 15 days needs a unanimous vote of the Board. Suppose the Board unanimously shortens the period to seven days because a proposed decision raises an urgent issue, and a Governor calls the proceeding on day ten. The call falls outside the period prescribed in paragraph (b), and a Governor's right to call depends on the call being made within that period.

Extending the period needs an affirmative vote of the majority of the Board then in office, taken during the 15 day period. The majority is counted against the Governors in office, not against those who attend. Suppose eighteen Governors are in office, eleven attend a meeting held during the period, and nine vote to extend. Nine is a clear majority of those present but not a majority of the eighteen in office, so the period is not extended.

Where a valid extension is made, a later call can be timely. Suppose the Board receives a proposed decision on 1 May, and on 8 May a majority of the Governors then in office votes to extend the period to 45 days. A Governor who calls the proceeding on 10 June has called it within the extended period.

What a Call Sets in Motion

The right to call belongs to a Governor. Once a Governor has called a proceeding within the period, FINRA Rule 9351(c) says the Board "shall review" it not later than its next meeting. Suppose Governor Ruiz calls a proceeding in time, and at the next meeting most of the other Governors say they see no reason to review it. The Board must still review the proceeding. The view of the other Governors does not undo the call.

The review also has a time limit. Suppose a Governor calls a proceeding on 12 May, within the period, and the Board's next meeting is on 20 May. The Board cannot put the review over to its July meeting for convenience; it must review the proceeding not later than the 20 May meeting.

Every proposed written decision of the National Adjudicatory Council goes to the Board, whatever its outcome. FINRA Rule 9349 lets the Council affirm, dismiss, modify or reverse the Hearing Panel's decision, requires it to prepare a proposed written decision, and requires that proposed decision to be provided to the Board. So a Council decision dismissing every charge against a registered representative is open to a Governor's call in the same way as a decision that sanctions one.

Which body serves the final decision depends on whether a call was made. If no Governor calls the proceeding, the Council's proposed decision becomes final and the Council serves it on the Parties and provides a copy to each FINRA member with which a Respondent is associated. If a Governor calls it, the Board issues and serves its own written decision in the same way.

Either body may serve its decision by electronic mail, and service by electronic mail is complete upon sending. That applies to the Council serving a decision that became final without a call as much as to the Board.

While the period for a call is still running, the Council's decision is only a proposed decision. It becomes final if the Board does not call the proceeding. The sanctions rule, FINRA Rule 9360, speaks of a sanction "specified in a decision constituting final disciplinary action". Suppose the Council's proposed decision bars a representative, and the period for a call has not yet run. That proposed decision is not yet a decision constituting final disciplinary action.

What the Board Can Do on Review

FINRA Rule 9351(d) lets the Board affirm, modify or reverse the Council's proposed written decision, and affirm, modify, reverse, increase or reduce any sanction, or impose any other fitting sanction. The power to increase does not depend on who sought review. Suppose a representative alone appealed a Hearing Panel fine to the Council, the Council reduced it, and a Governor called the proceeding. If the Board considers the reduced fine too low, it may increase it.

The Board is not confined to adjusting the kind of sanction the Council chose. Suppose the Board concludes that the suspension in the Council's proposed decision is the wrong kind of sanction and that a fine fits the misconduct better. It may impose the fine, as another fitting sanction, in place of the suspension.

The sanction powers reach the terms of a permanent cease and desist order. Suppose the Council's proposed decision includes a permanent cease and desist order whose terms the Board considers too narrow. The Board may modify those terms.

The Board need not decide every question itself. As an alternative to deciding, it may remand the disciplinary proceeding with instructions. Suppose the Board concludes that the record does not allow it to decide one issue. It may remand the proceeding with instructions on how that issue is to be dealt with. A Board decision that remands the proceeding is not FINRA's final disciplinary action.

What the Board's Written Decision Must Contain

The Board must prepare a written decision that includes all of the elements FINRA Rule 9349(b)(1) through (6) require of a Council decision. That holds whatever the Board decides. A Board that affirms the Council's proposed decision in full still prepares its own written decision containing every element.

Where the decision imposes a sanction, element (6) requires a statement describing the sanction, the reasons for it, and, pursuant to FINRA Rule 9360, the date on which it becomes effective. A decision that names a sanction without giving its reasons does not contain element (6).

One element is conditional. Element (1) is a statement describing the investigative or other origin of the disciplinary proceeding, "if not otherwise contained in the record". Where the record already shows how the proceeding began, the decision need not add a separate statement of its origin.

When the Sanctions in a Final Decision Take Effect

FINRA Rule 9360 sets the effective dates for sanctions in a decision issued under FINRA Rule 9349 or FINRA Rule 9351 that constitutes final disciplinary action. It treats a bar, an expulsion and a permanent cease and desist order differently from other sanctions. A bar takes effect upon service of the decision constituting final disciplinary action, unless the decision specifies otherwise. Suppose the Board's decision after a review bars a representative and says nothing about when the bar takes effect. The bar takes effect when the decision is served on the representative, not on the day the Board decides the review at its meeting.

An expulsion waits for the SEC stage. It does not take effect until the time for filing an application for review with the SEC has expired with no application filed or, if an application is timely filed, until the SEC completes its review under Exchange Act Section 19. Suppose a final decision in an appeal expels a member firm and the firm files a timely application for SEC review. The expulsion does not take effect while the SEC's review is pending.

Other sanctions, such as a suspension or a fine, take effect on a date to be determined by FINRA staff, unless the decision provides otherwise. What counts is the sanction in the decision that is final. Suppose the Council's proposed decision barred a representative, and the Board on review replaced the bar with a six-month suspension without saying when it begins. The suspension takes effect on a date determined by FINRA staff. The bar in the proposed decision never became part of a final decision, so the rule for bars does not apply.

The most serious sanctions also carry a service requirement. When the sanction is a bar, an expulsion or a permanent cease and desist order, FINRA must serve the decision on the Respondent by courier, facsimile or other means reasonably likely to obtain prompt service.

Sanctions and an Application to the SEC

Filing an application for SEC review stays the effectiveness of a sanction in a decision constituting FINRA's final disciplinary action, with stated exceptions. Suppose a final FINRA decision suspends a representative for three months and he files an application for review with the SEC. The suspension is stayed.

A bar is one of the exceptions. Suppose instead the final decision bars the representative and he files an application for SEC review. The application does not stay the bar.

The representative's firm is told. If a Respondent files an application for review with the SEC, FINRA must promptly notify any FINRA member with which the Respondent is associated.

Stays and Cease and Desist Orders While the Board Reviews

An appeal to the Council from a Hearing Panel decision, or a call for review by the Council, stays that decision. The stay does not end when the Council reaches its decision if the Board calls the case: it lasts until a decision is issued under FINRA Rule 9351. Suppose a Hearing Panel suspended a representative, he appealed, the Council affirmed, and a Governor called the proceeding. The suspension remains stayed while the Board reviews the proceeding.

A permanent cease and desist order is outside that stay. Suppose the Hearing Panel's decision also imposed a permanent cease and desist order. That part of the decision was not stayed by the appeal, and it remains in force while the Board reviews the proceeding.

Separation of Functions When a Call Is Considered

FINRA Rule 9144(b) bars a Hearing Officer, including the Chief Hearing Officer, and a Panelist of a Hearing Panel or an Extended Hearing Panel from participating in a discussion or decision relating to a call for review, a review or an appeal under the Rule 9300 Series. Suppose a Governor considering whether to call a proceeding asks one of the Panelists who heard it for a view. The Panelist may not take part in that discussion.

The same paragraph restricts Governors, and names the people with whom a Governor may not discuss those matters. Except where the Chair of the National Adjudicatory Council is also a Governor, a Governor is prohibited from participating in a discussion or a decision relating to those acts with the Review Subcommittee or the Adjudicators the paragraph refers to. Suppose a Governor who is not the Council's Chair discusses with the Hearing Officer who presided over a proceeding whether it should be called for review. That discussion is within the prohibition.

The restriction is framed by who is on the other side of the discussion. It bars discussion with the Review Subcommittee and the named Adjudicators. It does not, in those words, reach Governors discussing a possible call among themselves at a Board meeting, which is where a call is made and a review carried out.

The Board's own review is also a decision of the kind FINRA's ex parte communications rule protects. The Code defines an Adjudicator to include a board that presides over a proceeding and renders a decision, and a natural person who serves on it. FINRA Rule 9143 bars a Party, a Party's counsel or representative, and Interested FINRA Staff from making an ex parte communication relevant to the merits to an Adjudicator participating in a decision in that proceeding, unless there is notice and an opportunity for all Parties to participate. Suppose an attorney for the Department of Enforcement privately e-mails a Governor who is taking part in the Board's review, arguing that the Council's sanction was too lenient. That is the kind of communication FINRA Rule 9143 prohibits.

Common Errors About Board Review

Several errors recur. One is treating the call period as fifteen calendar days; the deadline is a Board meeting at least 15 days after receipt, which may be weeks later. A second is counting a vote to extend the period against the Governors present rather than the Governors then in office. A third is assuming that a proposed decision favourable to the respondent, such as a dismissal, escapes the Board; every proposed decision goes to the Board. A fourth is treating all sanctions in a final decision alike: a bar takes effect on service, an expulsion waits for the SEC stage, and other sanctions take effect on a date FINRA staff determine unless the decision provides otherwise. A fifth is assuming that an application for SEC review stays every sanction; it does not stay a bar.

Restoring a Charge the Council Dismissed

FINRA Rule 9349(a) lets the National Adjudicatory Council affirm, dismiss, modify or reverse the Hearing Panel's decision, and FINRA Rule 9349(b)(4) requires the Council's decision to include its conclusions as to whether the Respondent violated any provision alleged in the complaint. When a Governor calls the proceeding, FINRA Rule 9351(d) lets the Board affirm, modify or reverse that proposed written decision. It also lets the Board affirm, modify, reverse, increase or reduce any sanction, or impose any other fitting sanction.

Suppose a complaint charged a representative with two violations. The Hearing Panel found both and imposed a fine for each. On appeal, the Council's proposed decision dismissed the first charge and affirmed the finding and the fine on the second. A Governor calls the proceeding, and the Board concludes that the first violation was proved. The Board may modify the proposed decision by reversing the dismissal of the first charge, and it may impose a fitting sanction for that violation itself. It does not need the Council or the Hearing Panel to impose that sanction.

Naming the Provisions and Concluding on Each

The Board's written decision must include all of the elements described in FINRA Rule 9349(b)(1) through (6). Element (2) is the specific statutory or rule provisions that were alleged to have been violated. Of the six elements, only element (1), the statement of the proceeding's origin, carries the words "if not otherwise contained in the record".

Suppose the Board's decision after a review sets out findings of fact, its reasons and the sanction, and refers to the respondent's "misconduct" without identifying the rule provisions the complaint alleged he violated. The complaint, which names those provisions, is in the record. The decision still lacks element (2). The record qualification belongs to element (1) alone.

Element (4) is the conclusions as to whether the Respondent violated any provision alleged in the complaint. Suppose the complaint alleged violations of three provisions, and the Governor called the proceeding because of the sanction on one of them. The reason for the call does not narrow element (4). The Board's decision must still include its conclusions as to whether the respondent violated any provision alleged in the complaint, and all three were alleged.

When an Order or a Bar Imposed on Review Takes Effect

FINRA Rule 9360 groups a permanent cease and desist order with a bar. Either becomes effective upon service of the decision constituting final disciplinary action of FINRA, unless otherwise specified in that decision. Unless the Board remands the proceeding, its decision after a review is FINRA's final disciplinary action. Suppose the Board's decision after a review imposes a permanent cease and desist order on a respondent and says nothing about when the order takes effect. The order takes effect upon service of the Board's decision.

The words "unless otherwise specified therein" let the decision fix a different time. Suppose the Board's decision bars a representative and states that the bar takes effect on 1 September. The bar takes effect on 1 September.

Who Holds Each Power Under FINRA Rule 9351

FINRA Rule 9351 gives its powers to different holders. The right to call a proceeding for review belongs to a Governor. The power to order the Parties to file briefs, and the decision after review, belong to the FINRA Board. The Code defines a Governor as a member of the Board of Governors of FINRA, and the FINRA Board as the Board of Governors of FINRA.

Suppose a Governor calls a proceeding and, after studying the record, writes to the parties announcing that she has reduced the respondent's fine. Under FINRA Rule 9351(d), it is the FINRA Board that, after review, may reduce a sanction. The Governor's letter is not the Board's decision, and it does not reduce the fine.

In the Rule 9300 Series, the Code defines a Panelist to include a former Governor who is appointed to serve on a Subcommittee. Suppose a former Governor sat on the Subcommittee that considered an appeal, and she disagrees with the Council's proposed decision. She is no longer a member of the Board of Governors, so she is not a Governor and cannot call the proceeding for review.

The Council Chair's Exception and the Hearing Officer

FINRA Rule 9144(b) contains two prohibitions. The first bars a Hearing Officer, including the Chief Hearing Officer, and a Panelist of a Hearing Panel or an Extended Hearing Panel from participating in a discussion or decision relating to a call for review, a review or an appeal under the Rule 9300 Series. The second bars a Governor from participating in a discussion or decision relating to those acts with the Review Subcommittee or those Adjudicators, except where the Chair of the National Adjudicatory Council is also a Governor.

The exception is part of the second prohibition only. Suppose the Chair of the National Adjudicatory Council is also a Governor and wants to discuss with the Hearing Officer who presided over a proceeding whether it should be called for review. The exception releases the Chair from the bar on Governors. It does not release the Hearing Officer, who remains prohibited from participating in a discussion relating to a call for review.

Notifying Each Firm of an Application to the SEC

FINRA Rule 9370(b) requires FINRA to promptly notify any FINRA member with which a Respondent is associated if the Respondent files an application for review to the SEC. Suppose a representative is associated with two member firms when he files an application for SEC review of a final FINRA decision. FINRA must promptly notify both firms.

Examination Relevance and Key Takeaways

FINRA Rule 9350 is tested on the Series 24 General Securities Principal examination as the organizational header of the FINRA Board discretionary review subsection — understanding its structural role is prerequisite to correctly navigating FINRA Rule 9351's Governor call-for-review mechanism and the Board's dispositional powers.

The key points to retain are these: FINRA Rule 9350 is the subsection header for the single-rule FINRA Board discretionary review subsection within the 9300 series — it has no independent operative text but organizes FINRA Rule 9351; FINRA Rule 9351 governs the Governor call-for-review right, exercisable until the next Board meeting falling at least fifteen days after the Board receives the NAC's proposed decision, the Board's mandatory review at the next Board meeting if called, the Board's authority to order party briefing, and the Board's complete dispositional powers — affirm, modify, or reverse the proposed decision or remand the proceeding, and affirm, modify, reverse, increase, reduce, or substitute sanctions; the Board's review is the highest level of FINRA's internal appellate structure and its exercise is rare in practice; FINRA Rule 9350's subsection is positioned between the NAC formal consideration rule of FINRA Rule 9349 and the sanctions effectiveness rule of FINRA Rule 9360 within the 9300 series; and the rule was adopted as part of the original 1997 Code of Procedure.