Research Analysts and Research Reports (Debt): FINRA Rule 2242

Summary

This practice note discusses Rule 2242 of the Financial Industry Regulatory Authority (FINRA), which , addresses conflicts of interest regarding the publication and distribution of debt research reports and public appearances by debt research analysts. Similar to FINRA Rule 2241, which covers equity research reports and equity analysts. FINRA Rule 2242 requires broker-dealers to establish, maintain, and enforce written policies and procedures to identify and manage debt research-related conflicts of interest. Although Rule 2242 is similar to Rule 2241 (and its predecessor rule, NASD Rule 2711) its requirements reflect the differences between trading debt and equity securities, including providing an exemption for distributing debt research to certain institutional investors.