over their entire reporting history, one or more criminal
disclosures or two or more ``disclosures considered in developing
specified risk events.'' When narrowing the disclosure categories to
include only the ``final criminal matters'' and ``specified risk
events'' as defined in this proposal (including the five-year
lookback period), the results narrow to 174 final criminal matters
and 2,616 specified risk events, and to 414 brokers who met the
proposed numeric threshold of one or more final criminal matters or
two or more specified risk events in the prior five years.
---------------------------------------------------------------------------

    The additional proposed obligations would only apply to individuals
with one or more final criminal matters or two or more specified risk
events within the prior five years who seek to become owners, control
persons, principals, or registered persons of a firm. Accordingly,
FINRA examined registration information in order to identify all
individuals who would have met the proposed criteria and sought the
proposed roles during the review period. Those identified serve as a
reasonable estimate for the number of individuals who would have been
directly impacted by this proposal had it been in place at the time.
This analysis indicates that there were 110-215 such individuals per
year, as shown in Exhibit 3d. These individuals represent 0.09-0.16
percent of individuals who became owners, control persons, principals,
or registered

persons with a new member in any year during the review period.\96\
---------------------------------------------------------------------------

    \96\ These percentages are calculated by dividing FINRA's
estimate of the number of individuals who met the proposed criteria
each year during the review period and sought the proposed roles
(110-215 individuals per year) by the number of individuals who
became owners, control persons, principals, or registered persons
with a new member each year during the review period (122,003-
131,156 individuals per year).
---------------------------------------------------------------------------

    FINRA also analyzed firms that employed individuals who would be
directly impacted by this proposal. The analysis shows that in each
year over the review period, there were between 74-155 firms employing
individuals who would have met the proposed criteria. Approximately 41
percent of these firms were small, 12 percent were mid-size, and the
remaining 47 percent were large.\97\ FINRA estimates that approximately
31 percent of the individuals meeting the proposed criteria and who
sought the proposed roles were employed by small firms, ten percent by
mid-size firms and 59 percent by large firms.
---------------------------------------------------------------------------

    \97\ See supra note 71.
---------------------------------------------------------------------------

(d) Alternatives Considered
    FINRA recognizes that the design and implementation of the rule
proposals may impose direct and indirect costs on a variety of
stakeholders, including member firms, associated persons, regulators,
investors, and the public. Accordingly, in developing its rule
proposals, FINRA sought to identify alternative ways to enhance the
efficiency and effectiveness of the proposals while maintaining their
regulatory objectives. The following provides a discussion of the
alternatives FINRA considered for the current proposals.
1. Proposed Amendments to the FINRA Rule 9200 Series and FINRA Rule
9300 Series
    As an alternative to the proposal to authorize Hearing Officers to
impose conditions or restrictions, FINRA considered whether to require
sanctions imposed by the FINRA Hearing Panel or Hearing Officer in
disciplinary decisions to be effective during the pendency of the NAC
appeals and subsequent appeals. FINRA believes that such an approach
could be too restrictive in disciplinary matters with significant
sanctions and where the risk of harm may be specific to particular
activities. Accordingly, FINRA believes that conditions and
restrictions that are tailored specifically to the risk posed by the
individuals during the pendency of the appeals, and are reasonably
necessary for the purpose of preventing customer harm, would provide a
better balance between protecting investors and preventing undue costs
on individuals and firms while their appeals are pending.
2. Proposed Amendments to the FINRA Rule 9520 Series
    This proposal would subject statutorily disqualified individuals
employed with member firms to heightened supervision during the
pendency of their SD Applications. Considering that the problem
addressed by the proposed amendments to the FINRA Rule 9520 Series is
very specific, FINRA did not consider any significant alternatives to
this targeted proposal.
3. Proposed Amendments to FINRA Rule 8312
    Considering that this proposal would likely not be associated with
material economic impacts, FINRA did not consider any significant
alternatives to this proposal.\98\
---------------------------------------------------------------------------

    \98\ As discussed above, there were only four firms that became
subject to the taping requirements of Rule 3170 during the review
period.
---------------------------------------------------------------------------

4. Proposed Amendments to the FINRA Rule 1000 Series
    FINRA considered several alternatives to the numeric and
categorical thresholds for identifying individuals who would be subject
to the proposed amendments to the MAP Rules. In determining the
proposed threshold, FINRA focused significant attention on the economic
trade-off between incorrect identification of individuals who may not
subsequently pose risk of harm to their customers, and not including
individuals who may subsequently pose risk of harm to customers. FINRA
also considered three key factors: (1) The different types of reported
disclosure events, (2) the counting criteria (i.e., the number of
reported events), and (3) the time period over which the events are
counted. FINRA considered several alternatives for each of these three
factors.
a. Alternatives Associated With the Types of Disclosure Events
    In determining the different types of disclosure events, FINRA
considered all categories of disclosure events reported on the Uniform
Registration Forms, including the financial disclosures and the
termination disclosures. FINRA decided to exclude financial
disclosures, which include personal bankruptcies, civil bonds, or
judgments and liens. While these events may be of interest to investors
in evaluating whether or not to engage a broker, these types of events
are not by themselves direct evidence of customer harm. FINRA also
considered whether termination disclosures should be included as
specified risk events. Termination disclosures include job separations
after allegations against the brokers.\99\ Certain termination
disclosures reflect conflicts of interest between the firm and the
broker and, as a result, may not necessarily be indicative of
misconduct. Further, the underlying allegations in the termination
disclosures may be associated with other disclosure events, such as
those associated with customer settlements or awards, regulatory
actions or civil judicial actions, which are already included in the
proposed criteria. Where so, the underlying conduct posing potential
future customer harm would be captured in the proposed criteria. As a
result, FINRA did not include termination disclosures as specified risk
events. Accordingly, FINRA considered the remaining five categories of
disclosure events listed in Exhibit 3a.
---------------------------------------------------------------------------

    \99\ Termination disclosures involve situations where the
individual voluntarily resigned, was discharged, or was permitted to
resign after allegations.
---------------------------------------------------------------------------

    Within each disclosure category included in the proposed criteria,
FINRA considered whether pending matters should be included or if the
criteria should be restricted to final matters that have reached a
resolution not in favor of the broker. Pending matters may be
associated with an emerging pattern of customer harm and capture timely
information of potential ongoing or recent misconduct. However, pending
matters may also include disclosure events that remain unresolved or
subsequently get dismissed because they lack merit or suitable
evidence. FINRA excluded pending matters in the current proposal
because the potential adverse impacts on the individuals who may be
identified because of pending matters would likely outweigh the benefit
of including pending matters.\100\
---------------------------------------------------------------------------

    \100\ For example, individuals who may be identified on a fixed
numeric threshold based upon pending matters could find it difficult
to become owners, control persons, principals, or registered persons
of a member firm while these matters are pending, even if such
matters are subsequently dismissed. See also Exhibit 3c.
---------------------------------------------------------------------------

    Exhibit 3a shows the five categories of disclosure events that were
considered and the subcategories that were included in the proposed
criteria. For criminal matters, FINRA considered whether criminal
charges that do not result in a conviction or a plea of guilty or nolo
contendere (no contest) should be included in the proposed criteria.
These events correspond to criminal matters in which the associated
charges

were subsequently dismissed or withdrawn and, as a result, are not
necessarily evidence of misconduct. Accordingly, FINRA only included
criminal convictions, including pleas of guilty or nolo contendere (no
contest), in the proposed criteria.
    For customer settlements and awards, FINRA considered whether
settlements and awards in which the broker was not ``named'' should be
considered as a specified risk event. These ``subject of'' customer
settlements and awards correspond to events where the customer
initiates a claim against the firm and does not specifically name the
broker, but the firm identifies the broker as required by the Uniform
Registration Forms.\101\ In these cases, the broker is not party to the
proceedings or settlement. There may be conflicts of interest between
the firm and the broker such that the claim may be attributed to the
broker without the ability of that broker to directly participate in
the resolution. Accordingly, FINRA excluded ``subject of'' customer
settlements and awards from the proposed criteria. FINRA recognizes
that excluding these events may also undercount instances where the
broker may have been responsible for the alleged customer harm.
---------------------------------------------------------------------------

    \101\ For example, the Instructions to Form U4 provide that the
answer to Questions 14I(4) or 14I(5) should be ``yes'' if the broker
was not named as a respondent/defendant but (1) the Statement of
Claim or Complaint specifically mentions the individual by name and
alleges the broker was involved in one or more sales practice
violations or (2) the Statement of Claim or Complaint does not
mention the broker by name, but the firm has made a good faith
determination that the sales practice violation(s) alleged involves
one or more particular brokers.
---------------------------------------------------------------------------

    For civil judicial actions and regulatory actions, FINRA considered
whether all sanctions associated with final matters should be included
in the proposed criteria or whether certain less severe sanctions
should be excluded. Final regulatory action or civil judicial action
disclosures may be associated with a wide variety of activities,
ranging from material customer harm to more technical rule violations,
such as a failure to make timely filings or other events not directly
related to customer harm. However, due to the way in which such
information is currently reported, it is not straightforward to
distinguish regulatory or civil judicial actions associated with
customer harm from other such actions.\102\ In the absence of a
reliable way to identify regulatory and civil judicial actions
associated with customer harm, FINRA considered using a proxy of
severity of the underlying sanctions as a way to exclude events that
are likely not associated with material customer harm. Therefore, FINRA
is proposing to include regulatory actions or civil judicial actions
that are associated with more severe sanctions, such as bars,
suspensions or monetary sanctions above a de minimis dollar threshold
of $15,000. FINRA notes that relying strictly on a proxy for severity
would likely exclude certain regulatory actions or civil judicial
actions that are associated with customer harm, and may include certain
regulatory actions or civil judicial actions that are not associated
with customer harm.
---------------------------------------------------------------------------

    \102\ For example, the Uniform Registration Forms contain
information in disclosure reporting pages that could be useful in
identifying regulatory actions or civil judicial actions associated
with customer harm, but it is stored as ``free-text'' and,
therefore, cannot be reliably compared across disclosures.
---------------------------------------------------------------------------

    FINRA also considered several alternative de minimis dollar
thresholds for disclosure events included in the proposed criteria. For
example, FINRA considered higher dollar thresholds of $25,000, $50,000
and $100,000 for customer settlements, customer awards, and monetary
sanctions associated with regulatory actions and civil judicial
actions. A dollar threshold may capture a dimension of severity of the
alleged customer harm. The Uniform Registration Forms establish a de
minimis dollar reporting threshold of $10,000 for complaints filed
prior to 2009 and $15,000 afterwards. The reporting threshold may,
however, be low and possibly include instances where the payment was
made to end the complaint and minimize litigation costs. However, the
dollar threshold does not account for the value of the customers'
accounts, and there are likely cases where even low dollar amounts
represent remuneration of a significant portion of customer
investments. Accordingly, a dollar threshold may be both under-
inclusive and over-inclusive, and as a result FINRA considered a range
of alternative thresholds. Increasing the dollar threshold from $15,000
to $25,000, $50,000 and $100,000 would decrease the number of
individuals impacted by this proposal from 110-215 individuals each
year over the review period (as explained above) to 108-207
individuals, 103-197 individuals and 97-180 individuals each year,
respectively. Finally, FINRA notes that establishing a de minimis
dollar threshold that is different than the current reporting
requirements could increase confusion among investors and registered
persons and would likely create additional incentives for brokers and
firms to keep future settlements below the dollar level that would
trigger the restrictions, to the detriment of customers.
b. Alternatives Associated With the Counting Criteria
    FINRA considered a range of alternative criteria for counting
criminal matters or specified risk events. For example, FINRA
considered whether the counting criteria for final criminal matters
should be two or more final criminal matters or one final criminal
matter and another specified risk event. This alternative would
effectively count final criminal matters the same way as other
specified risk events. FINRA believes that final criminal matters are
generally more directly tied to serious misconduct than some of the
other specified risk events. Accordingly, FINRA believes that one final
criminal matter, as defined by this proposal, should be sufficient to
trigger the proposed criteria.\103\
---------------------------------------------------------------------------

    \103\ FINRA recognizes that final criminal matters include
felony convictions that may not be investment related (e.g., a
conviction associated with multiple DUIs).
---------------------------------------------------------------------------

    FINRA also considered alternative criteria for counting specified
risk events. For example, FINRA considered decreasing the proposed
threshold from two specified risk events to one. This alternative would
change the proposed criteria to one or more final criminal matters or
one (instead of two) or more specified risk events during the prior
five-year period. This approach would increase the number of
individuals impacted by this proposal from 110-215 individuals to 341-
675 individuals each year, over the review period. FINRA also
considered increasing the proposed threshold from two specified risk
events to three, thereby changing the proposed criteria to one or more
final criminal matter or three (instead of two) or more specified risk
events during the prior five-year period. This approach would decrease
the number of individuals impacted by this proposal from 110-215
individuals to 86-161 individuals each year, over the review period.
For the reasons explained above, FINRA considered alternative criteria
for counting specified risk events, but chose the specification in the
current proposal.
c. Alternatives Associated With the Time Period Over Which the
Disclosure Events Are Counted
    FINRA also considered alternative criteria for the time period over
which final criminal matters and specified risk events are counted. For
example, FINRA considered whether final criminal matters or specified
risk events should

be counted over the individual's entire reporting period or counted
only over a more recent period. Based on its experience, FINRA believes
that events that are more than ten years old do not necessarily pose
the same level of possible future risk to customers as more recent
events. Further, counting final criminal matters or specified risk
events over an individual's entire reporting period would imply that
individuals with such events would be subject to the criteria for their
entire career, even if they subsequently worked without being
associated with any future events. Accordingly, FINRA decided to
include final criminal matters or specified risk events occurring only
in a more recent period.
    FINRA also considered a threshold based on a five-year lookback
period for final criminal matters, but a five-to-ten year lookback
period for specified risk events. Specifically, FINRA considered a
threshold that would be met if the individual had one specified risk
event having resolved during the previous ten years, and a second
specified risk event resolved during the previous five years, or if the
individual had one or more final criminal matters resolved in the prior
five-year period. This approach would increase the number of
individuals impacted by this proposal from 110-215 individuals to 127-
236 individuals each year, over the review period. For the reasons
explained above, FINRA considered alternative criteria for the lookback
period for specified risk events, but chose the specification in the
current proposal.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    The proposed rule change was published for comment in Regulatory
Notice 18-16 (April 2018). Thirteen comments were received in response
to the Regulatory Notice.\104\ A copy of the Regulatory Notice is
attached as Exhibit 2a [sic]. A list of commenters is attached as
Exhibit 2b [sic]. Copies of the comment letters received in response to
the Regulatory Notice are attached as Exhibit 2c [sic]. Of the 13
comment letters received, eight were generally in favor of the proposed
rule change, two were generally opposed, and one stated that the
proposal was an improvement over the status quo but that significantly
more action would be needed to protect investors.
---------------------------------------------------------------------------

    \104\ All references to commenters are to the comment letters as
listed in Exhibit 2b.
---------------------------------------------------------------------------

    FINRA has considered the comments received. In light of some of
those comments, FINRA has made some modifications to the proposal. The
comments and FINRA's responses are set forth in detail below.
General Support for and Opposition to the Proposal
    Five commenters expressed general support for the proposed rule
changes in Regulatory Notice 18-16, but all had suggestions on how
aspects of the proposal should be modified.\105\ Two commenters
expressed support for the proposed amendments, subject to certain
modifications.\106\ One commenter expressed general support for the
proposed amendments except the proposed amendments to the Rule 1000
Series.\107\ Two commenters suggested different approaches that FINRA
could take.\108\ One commenter expressed opposition to specific aspects
of the proposal.\109\ One commenter opined that the proposal has
numerous deficiencies and offered remedies.\110\ All of these
commenters' suggestions are discussed in more detail below.
---------------------------------------------------------------------------

    \105\ MML, NASAA, PIABA, SIFMA, Wulff Hansen.
    \106\ Cambridge, FSI.
    \107\ Janney.
    \108\ Better Markets, IBN.
    \109\ Luxor.
    \110\ Network 1.
---------------------------------------------------------------------------

Proposed Amendments to the FINRA Rules 9200 and 9300 Series To Enhance
Investor Protection During the Pendency of an Appeal or Call-for-Review
Proceeding
[rtarr8] Conditions or Restrictions
    The proposed amendments to the Rule 9200 and 9300 Series would
allow a Hearing Officer to impose conditions or restrictions on the
activities of a respondent during the pendency of an appeal to the NAC
from, or call for NAC review of, a disciplinary decision.
    Some commenters expressed support for these specific proposals. FSI
commented that permitting Hearing Officers to impose conditions and
restrictions strikes the appropriate balance between the member's
rights and investor protection concerns. NASAA supported imposing
temporary remedies on parties that lose at the hearing level, writing
that it would align FINRA's procedures with federal and state law.
PIABA wrote that a disciplinary respondent should not be permitted to
conduct business as usual during a disciplinary appeal.
    Several commenters requested that a disciplined respondent and
firms that associate with a disciplined respondent have an opportunity
to propose to the Hearing Officers the conditions and restrictions that
should be imposed.\111\ Cambridge stated that this opportunity would
help ensure that conditions and restrictions are not overly broad and
account for a firm's size, resources and ability to supervise, and that
it would alleviate concerns about potential lost income, lost
opportunities and lost clients that could result from the conditions or
restrictions. SIFMA wrote that this opportunity would help ensure that
any conditions and restrictions imposed are reasonably necessary for
the nature and scale of the misconduct at issue and tailored to a
firm's business model, and that it would reduce the number of motions
to modify or remove conditions or restrictions.
---------------------------------------------------------------------------

    \111\ Cambridge, FSI, SIFMA.
---------------------------------------------------------------------------

    While FINRA appreciates the comments, FINRA notes that the proposal
allows an individual respondent to make arguments concerning the
potential conditions and restrictions to the Hearing Officer. In this
regard, nothing in the proposed rule change prevents a respondent in a
disciplinary proceeding from proposing, in opposition or response to a
motion for conditions or restrictions, the conditions and restrictions
that could or should be imposed. Likewise, nothing prevents an
individual respondent, during the underlying disciplinary proceeding
itself, from introducing relevant evidence. Moreover, FINRA rules only
give named parties the right to participate in a FINRA disciplinary
proceeding, and the complaint issued against an individual respondent
will not always name that person's employing firm as a respondent.
However, in light of these comments, FINRA is proposing to modify the
proposed rule as set forth in Regulatory Notice 18-16 to clarify that a
respondent's opposition or other response to a motion for conditions or
restrictions must explain why no conditions or restrictions should be
imposed or specify alternate conditions or restrictions that are sought
to be imposed and explain why the conditions or restrictions are
reasonably necessary for the purpose of preventing customer harm.
    Cambridge stated that the proposal does not address the recourse
available for damages that could result from any conditions or
restrictions imposed, in the event the underlying disciplinary decision
is reversed on appeal. FINRA believes the proposal mitigates such
risks. The standard for imposing conditions or restrictions--those that
the Hearing Officer considers reasonably necessary for the purpose of
preventing customer harm--and the ability to

request an expedited proceeding before the Review Subcommittee for
prompt review of any conditions or restrictions imposed would act to
ensure the conditions and restrictions imposed are reasonably tailored
to address the potential concerns. The Hearing Officer that imposes
conditions or restrictions in the first instance would be knowledgeable
about the case and, therefore, well-suited to craft restrictions or
conditions that are tailored to addressing the potential customer harm.
And if a respondent believes that the conditions or restrictions
imposed are too burdensome, the respondent would be permitted to
request an expedited review and stay the conditions or restrictions.
    Better Markets suggested that Hearing Officers should be required,
not just permitted, to impose conditions or restrictions that are
necessary to protect investors pending an appeal to the NAC. FINRA
believes, however, that it is more appropriate to give Hearing Officers
discretion. There may be situations when conditions or restrictions may
be deemed not necessary, such as when a respondent firm or a respondent
individual's employing firm has already undertaken substantial
subsequent remedial measures or when the violations at issue do not
involve the risk of customer harm.
    FSI and Luxor opposed the standard in proposed FINRA Rule 9285(a)
that the Hearing Officer may impose conditions or restrictions that it
considers ``reasonably necessary for the purpose of preventing customer
harm.'' FSI opined that that standard could lead to conditions or
restrictions that are unduly burdensome or unrelated to the misconduct,
and it suggested that the standard also require that the conditions and
restrictions be ``reasonably designed to prevent further violations of
the rule or rules the Hearing Panel or Hearing Officer [in the
underlying disciplinary proceeding] has found to have been violated.''
FSI further suggested that, when imposing conditions or restrictions,
Hearing Officers be required to consider the firm's size, resources and
overall ability to supervise the registered representative's compliance
with the conditions or restrictions. Luxor wrote that the proposed
standard would have a chilling effect on a respondent's right to appeal
because, depending on the conditions and restrictions imposed, the
respondent may be unable to afford legal representation or may suffer
irreversible damage to a book of business.
    FINRA's proposed standard, however, is consistent with the rules of
other self-regulatory organizations.\112\ Moreover, FINRA believes that
the proposed standard--both its use of the term ``reasonably
necessary'' and its emphasis on ``for the purpose of preventing
customer harm''--provides sufficient and appropriate limiting
parameters. FINRA also believes that requiring that conditions or
restrictions be reasonably designed to prevent further violations of
the rule or rules found to have been violated in the underlying
disciplinary decision, as FSI suggests, may not allow the Hearing
Officer to adequately address the investor protection concerns that
have been raised by the activities of the respondent. As FINRA
explained above (and in Regulatory Notice 18-16), the conditions and
restrictions imposed should target the misconduct demonstrated in the
disciplinary proceeding and be tailored to the specific risks posed by
the member firm or broker. With regard to FSI's suggestions to amend
the standard to require consideration of numerous additional factors,
FINRA believes that, for investor protection purposes, the primary
driver of the conditions or restrictions should be what is reasonably
necessary to prevent customer harm, not the size of the respondent's
employing firm or its claims about its resources. FINRA believes that
the proposed standard--coupled with the parties' ability to participate
in the process, the knowledge of the Hearing Officers, and the
availability of an expedited review--are appropriate to yield
conditions or restrictions that are targeted at the specific,
identifiable risks presented to customers and that are not overly
burdensome. FINRA further proposes, that in light of this and other
comments, to clarify the process for imposing conditions and
restrictions during the pendency of an appeal. Specifically, FINRA is
proposing to modify the proposed rule as set forth in Regulatory Notice
18-16 to clarify when and how parties can seek to impose reasonably
necessary conditions and restrictions following a disciplinary decision
by a Hearing Panel or Hearing Officer, the process for a respondent to
request an appeal through an expedited proceeding of such conditions
and restrictions, and to further clarify that such conditions and
restrictions would be stayed during such expedited proceeding.
---------------------------------------------------------------------------

    \112\ See BOX Rule 12110 (``Pending effectiveness of a decision
imposing a sanction on the Respondent, the person, committee or
panel issuing the decision (the `adjudicator') may impose such
conditions and restrictions on the activities of the Respondent as
it considers reasonably necessary for the protection of investors
and the Exchange.''); CBOE Rule 13.11(b) (``Pending effectiveness of
a decision imposing a sanction on the Respondent, the Hearing Panel
or the CRO, as applicable, may impose such conditions and
restrictions on the activities of the Respondent as the Hearing
Panel or the CRO, as applicable, considers reasonably necessary for
the protection of investors and the Exchange''); CBOE BZX Rule 8.11
(``Pending effectiveness of a decision imposing a penalty on the
Respondent, the CRO, Hearing Panel or committee of the Board, as
applicable, may impose such conditions and restrictions on the
activities of the Respondent as he, she or it considers reasonably
necessary for the protection of investors, creditors and the
Exchange.''); MIAX Options Rule 1011(b) (``Pending effectiveness of
a decision imposing a sanction on the Respondent, the person,
committee or panel issuing the decision (the `adjudicator') may
impose such conditions and restrictions on the activities of the
Respondent as it considers reasonably necessary for the protection
of investors and the Exchange.'').
---------------------------------------------------------------------------

    Several commenters requested that a different burden be applied in
proposed Rule 9285(b)(2) for seeking the modification or removal of
conditions or restrictions.\113\ PIABA suggested that, to modify or
remove conditions or restrictions, the respondent should be required to
provide clear and convincing evidence of a manifest error by the trier
of fact and show the likelihood of success of the underlying appeal.
Cambridge and FSI suggested that the respondent should have to show
that the Hearing Officer committed an error, that the conditions or
restrictions are overly broad, or that they are not narrowly tailored
to prevent future occurrences of the underlying violations.
---------------------------------------------------------------------------

    \113\ Cambridge, FSI, PIABA.
---------------------------------------------------------------------------

    FINRA declines these comments. As explained above, the burden in
proposed Rule 9285(b)(2) is that the respondent would have to
demonstrate that the conditions or restrictions imposed are not
reasonably necessary for the purpose of preventing customer harm. This
burden is consistent with the standard set forth in proposed Rule
9285(a) for establishing conditions and restrictions in the first
place. Furthermore, FINRA believes that, for fairness reasons, a
respondent's ability to seek the modification or removal of conditions
or restrictions should not be constrained by the underlying merits of
the respondent's disciplinary appeal. Because there would be a
separate, specific standard for the imposition of conditions or
restrictions--i.e., those that the Hearing Officer considers reasonably
necessary for the purpose of preventing customer harm--any conditions
or restrictions imposed could be erroneous for a reason that is
entirely unrelated to whether a respondent's underlying appeal has a
likelihood of success. Likewise, FINRA does not

support establishing a burden of proof that would be more difficult to
meet, such as a ``clear and convincing evidence of a manifest error by
the trier of fact'' standard. Thus, FINRA has retained that aspect of
the standard proposed in Regulatory Notice 18-16 that would require a
respondent to demonstrate, when moving to modify or remove conditions
or restrictions, that the conditions or restrictions imposed are not
reasonably necessary for the purpose of preventing customer harm.
    PIABA and Better Markets wrote about the provisions in proposed
Rule 9285(b) that would allow a respondent to seek expedited review of
an order imposing conditions or restrictions. PIABA supported the
proposed expedited review process. Better Markets, on the other hand,
wrote that expedited reviews would add burdens to the NAC and cause
delays in processing underlying disciplinary appeals. FINRA has
retained the proposed expedited review process. FINRA has added the
expedited review process to make the overall process more fair for the
respondents involved. It also will further investor protection: Because
the filing of a motion to modify or remove conditions or restrictions
would stay the effectiveness of the conditions or restrictions, an
expedited review would allow properly imposed conditions and
restrictions to become effective sooner. Moreover, because proposed
Rule 9285(b) would assign the NAC's Review Subcommittee--and not the
NAC itself--to decide motions to modify or remove conditions or
restrictions and establish a 30-day deadline for doing so, FINRA
expects that the expedited review process will not result in materially
longer times for the NAC to process underlying disciplinary appeals.
    Several commenters disagreed with how, pursuant to proposed Rule
9285(b), a motion to modify or remove conditions or restrictions would
effect a stay of the conditions or restrictions. Better Markets and
NASAA suggested that, for investor protection reasons, there should be
no stays. NASAA further commented that permitting stays would be
inconsistent with how proposed Rule 9285(b) would require firms to
establish heightened supervision over individuals who appeal
disciplinary decisions. Luxor, on the other hand, essentially sought to
expand stays, writing that no conditions and restrictions should be
imposed during a disciplinary appeal except upon a showing by FINRA of
clear and convincing evidence of imminent harm to the public.
    In light of the conflicting comments and FINRA's belief that the
stay provision strikes the right balance, FINRA is proposing to retain
the proposed stay provision. It appropriately balances the investor-
protection benefits of imposing reasonably necessary conditions and
restrictions with the Exchange Act requirement that FINRA provide a
fair procedure in disciplinary proceedings. A stay of appropriately
issued conditions or restrictions would be in place only during the
relatively short duration of an expedited proceeding. Moreover, FINRA
does not agree that having a temporary stay of conditions or
restrictions during the expedited proceeding process and requiring
firms to establish heightened supervision plans during the pendency of
appeals are inconsistent. Proposed Rule 9285(e) would require a
disciplined respondent's member firm to establish a reasonably designed
heightened supervision plan regardless of whether a Hearing Officer
imposes conditions and restrictions.\114\ Thus, there is no reason for
a respondent's firm to delay adopting a heightened supervision plan
while any conditions or restrictions are stayed pending an expedited
review. Moreover, proposed Rule 9285(e) contemplates that a
respondent's firm would need to create an amended plan of heightened
supervision that takes into account any conditions or restrictions
imposed after the initial plan is adopted.
---------------------------------------------------------------------------

    \114\ See also Regulatory Notice 18-15 (April 2018) (Guidance on
Implementing Effective Heightened Supervisory Procedures for
Associated Persons with a History of Past Misconduct).
---------------------------------------------------------------------------

    PIABA wrote that the proposal should require that an individual
respondent's employing firm be notified immediately of any conditions
or restrictions imposed. FINRA generally agrees with this comment and,
as explained above, has modified the proposal to require that the
Office of Hearing Officers or the Office of General Counsel, as
appropriate, provide a copy of the order imposing conditions and
restrictions to each FINRA member with which the respondent is
associated. This would be similar to how FINRA rules currently require
that copies of disciplinary decisions be provided to each FINRA member
with which a respondent is associated.\115\
---------------------------------------------------------------------------

    \115\ See Rule 9268(d).
---------------------------------------------------------------------------

[rtarr8] Heightened Supervision of Disciplined Respondents
    FINRA also received comments concerning the proposed amendments to
require, in the event of an appeal or call for review, that an
individual respondent's member firm adopt heightened supervisory
procedures for that individual respondent.
    Better Markets and PIABA expressed support for requiring firms to
adopt written plans of heightened supervision while a disciplinary
appeal is pending.
    FSI and SIFMA stated that requiring firms to adopt written plans of
heightened supervision within ten days of any appeal or call for review
is an insufficiently short amount of time, and that firms should have
30 days. FINRA believes, however, that the ten-day period is
appropriate under the circumstances. The longer the time period without
a plan of heightened supervision in place, the greater the risk to
investors. Retaining the shorter, ten-day deadline will allow the
investor-protection benefits of the heightened supervision plans to be
in place sooner. FINRA also believes that the ten-day period is
sufficient because a firm should be aware of the potential need to
adopt a heightened supervision plan well in advance of when it would be
required to do so. In this regard, Form U4 requires that registered
persons report when they are the subject of a regulatory complaint that
could result in an affirmative answer to other Form U4 disclosure
questions that ask about self-regulatory organization findings and
disciplinary actions, and FINRA rules require that the Office of
Hearing Officers promptly provide a copy of a disciplinary decision to
each member with which a respondent is associated. Furthermore, the
ten-day deadline for adopting a heightened supervision plan would begin
only when the respondent appeals the decision to the NAC or when the
matter is called for review. FINRA Rules 9311 and 9312 provide 25 days
to file an appeal and 25 to 45 days to call a case for review.
    PIABA suggested that a firm required to adopt a plan of heightened
supervision pursuant to proposed Rule 9285 also should be required to
document its enforcement of that plan. FINRA has previously indicated
that documenting the enforcement of a heightened supervision plan could
be a useful element of such a plan.\116\ Instead of singling out
additional provisions like these in the rule text, however, FINRA
believes that its published notices provide a thorough source of
guidance on heightened supervision plans, including what provisions
should

be included at a minimum, and what other provisions can be part of an
effective plan.\117\ As needed or appropriate, FINRA would be able to
update its published guidance to account for the heightened supervision
plans required by the proposed rule change.
---------------------------------------------------------------------------

    \116\ See Notice to Members 97-19 (April 1997) (advising that
firms could require supervisors of registered representatives
subject to special supervisory arrangements to provide a sign-off on
daily activity or to periodically attest in writing that they have
carried out the terms of the special supervision).
    \117\ See Notice to Members 97-17 (April 1997); Regulatory
Notice 18-15 (April 2018).
---------------------------------------------------------------------------

    Luxor suggested that heightened supervision plans would not be
necessary where a Hearing Officer imposes conditions or restrictions.
FINRA believes that even when conditions and restrictions are imposed,
the respondent's member firm would still need to address, in a
heightened supervision plan, how it would implement and execute those
conditions and restrictions. Furthermore, heightened supervision plans
would be needed to address activities that are not subject to any
imposed conditions or restrictions.
Proposed Amendments to the FINRA Rule 9520 Series To Require Automatic
Interim Plans of Heightened Supervision of a Disqualified Person During
the Period When FINRA Is Reviewing an Eligibility Application
    Several commenters specifically approved of the proposed amendments
to Rule 9522, which would require a member firm to adopt interim
heightened supervisory procedures for a disqualified person during the
pendency of the firm's SD Application to continue associating with that
disqualified person. NASAA commented that this regulatory gap should be
closed. PIABA commented that there is an obvious benefit to the
proposal.
    Better Markets suggested that firms should be required to adopt a
plan of heightened supervision immediately when an associated person is
found to have committed acts that are grounds for becoming
disqualified, even pending the associated person's appeal of the
underlying disqualifying event. While FINRA agrees that there may be
benefits to requiring firms to place a disqualified associated person
on a heightened supervision plan immediately and before the filing of
an application to continue associating with that person, FINRA believes
the timing requirement of the proposed rule--to require such a plan
once a firm has made a determination to seek approval for continued
association with the disqualified associated person--strikes the
appropriate balance.
    Network 1 wrote that requiring firms to expend resources on
developing heightened supervision plans for disqualified persons while
an SD Application is pending is a disincentive to hiring the person at
all. While FINRA recognizes that the requirement to develop and
implement an interim heightened supervision plan in these circumstances
may deter some firms from retaining or hiring a disqualified person,
FINRA believes that if a firm elects to sponsor a disqualified person
it needs to provide greater oversight of the activities of such person
during the pendency of the SD Application, thereby reducing the
potential risk of customer harm during this period. Moreover, if the SD
Application is approved by FINRA, the firm would in almost all cases be
required to prepare a plan of heightened supervision.
    Aderant noted that although proposed Rule 9522(g) sets a ten-day
deadline to remedy a substantially incomplete application that seeks
the continued associated of a disqualified person, the version proposed
in Regulatory Notice 18-16 did not identify the specific event that
triggers the ten-day deadline. FINRA agrees that a modification is
appropriate and has revised proposed Rule 9522(g) to establish that the
event triggering the ten-day deadline is service of the notice of
delinquency.
Proposed Amendments to FINRA Rule 8312
    The proposed amendments to FINRA Rule 8312 would remove the
requirement that the only means through which persons can request
information as to whether a particular member is subject to the
provisions of the Taping Rule is a telephonic inquiry via the
BrokerCheck toll-free telephone listing. The proposed amended rule
would permit FINRA to release this information through BrokerCheck
regardless of how it is requested.
    NASAA agreed with this proposal, stating that it would advance
investor protection.
    Other commenters opposed it. Luxor wrote that the proposal is
punitive, will disproportionately cause reputational damage to small
firms, and will create a perception that a taping firm and its
representatives are to be viewed negatively simply by association with
behavior that occurred at other firms and other persons. Network 1
commented that there is little likelihood the public will understand
the difference between a taping firm and a disciplined firm. FINRA
notes that Rule 8312 already provides, however, that FINRA will release
whether a particular member firm is subject to the Taping Rule in
response to telephonic inquiries via the BrokerCheck toll-free
telephone listing. The proposed amendments--which will only remove the
telephonic inquiry limitation--will simply make it easier for investors
to obtain this same information by expanding the means through which
investors can access it. Moreover, the comment that the proposed
amendments would have a disproportionate effect on small firms has no
basis; there is currently only one firm subject to the Taping Rule.
    Several comments raised concerns regarding the content of the
proposed BrokerCheck disclosure relating to taping firms. Better
Markets and PIABA requested that the disclosure be explained in
BrokerCheck and include a specific narrative description of why the
disclosure is being made. NASAA suggested that the proposed BrokerCheck
disclosure appear only on the BrokerCheck reports of the few firms that
are subject to the Taping Rule. NASAA further commented that the
disclosure should identify the firm as subject to the Taping Rule and
explain in plain English what that means. Network 1 and Better Markets
raised concerns as to how the proposed amendments would impact the
information disclosed through BrokerCheck concerning individuals.
Network 1 requested that FINRA amend the proposal to ensure that the
information disclosed on BrokerCheck not communicate any ``guilt by
association'' for persons who are employees of taping firms and who
have ``clean records.'' Better Markets, on the other hand, suggested
that the BrokerCheck profiles of individual brokers should denote when
they are associated with taping firms.
    FINRA appreciates the concerns expressed and agrees that the
BrokerCheck disclosure of a firm as being subject to the Taping Rule
should include a clear explanation of what that means, to help
investors understand why the taping firm is subject to heightened
procedures and incent them to research the background of a broker
associated with the taping firm.
Proposed Amendments to the FINRA Rule 1000 Series To Impose Additional
Obligations on Member Firms That Associate With Persons With a
Significant History of Past Misconduct
[rtarr8] General Comments
    The proposed amendments to the FINRA Rule 1010 Series would require
a member firm to submit a letter to Member Regulation seeking a
materiality consultation when a natural person that has, in the prior
five years, one or more ``final criminal matters'' or two or more
``specified risk events''

seeks to become an owner, control person, principal or registered
person.
    Several commenters expressed general support for the proposed
amendments to the Rule 1000 Series.\118\ Better Markets characterized
requiring materiality consultations before hiring as an important
regulatory innovation. NASAA described the proposal as a reasonable
means of getting Member Regulation more involved in members' decisions
to associate with individuals who have significant disciplinary
histories. PIABA wrote that the proposed amendments would promote
investor protection, adequately apply stronger standards for continuing
membership, and remind firms of the need to keep new representatives
with significant disciplinary histories under a well-defined, well-
enforced supervisory plan.
---------------------------------------------------------------------------

    \118\ Better Markets, Cambridge, NASAA, PIABA.
---------------------------------------------------------------------------

    Janney and SIFMA commented that the proposed rule requiring
materiality consultations is contrary to the spirit of FINRA's current
guidance about materiality consultations, which they assert focuses on
changes to a firm's business model and not the activity or
employability of individuals. FINRA disagrees with this assertion and
believes the proposed rule is consistent with FINRA rules governing the
membership application process, which considers, among other things,
firms' hiring decisions and individuals' past activities. For example,
the safe harbor in IM-1011-1 is premised on the notion that hiring a
certain number of associated persons involved in sales can be a
material change in business operations that requires the filing of a
CMA, and the safe harbor is not available to a member firm or a
principal of a firm that has a specified disciplinary history.
Likewise, FINRA rules require Member Regulation to consider, in new
membership applications and CMAs, a variety of criminal, civil,
regulatory, and arbitration events when assessing whether an applicant
and its associated persons are capable of complying with federal
securities laws, the rules and regulations thereunder, and FINRA
rules.\119\
---------------------------------------------------------------------------

    \119\ See Rule 1014(a)(3).
---------------------------------------------------------------------------

    Several commenters expressed concern about the possible negative
impact of the proposed rule on a firm's hiring practices and the
ability of individuals with such events to be hired. Luxor commented
that the proposed rule changes are unnecessary, because FINRA can
contact a firm when it has hired ``high-risk brokers.'' Luxor also
commented that if a person has a license to operate and has not been
barred or otherwise precluded from operating, no additional
consultation should be required when a firm wishes to hire that person.
Janney stated that the investing public and the markets would be better
protected by FINRA taking contemporaneous action, instead of disrupting
the hiring practices of an unrelated firm as many as five years after
the underlying disclosure events in proposed Rule 1017(a)(7) and IM-
1011-3 have occurred. Janney also expressed the view that it appears
that FINRA would like to review transitions specifically in the context
of an affiliation change, and the proposed rule would create the
ability to prevent transition of a registered representative without
taking enforcement action.
    FINRA believes the proposed rule is necessary to ensure that FINRA
has a more meaningful regulatory touchpoint at the time an individual
with a significant history of misconduct seeks to become an owner,
control person, principal or registered person of a member firm. The
proposal would apply in the limited circumstance where such individual
meets the required thresholds for disclosure events. FINRA believes
requiring firms to ask FINRA for a materiality consultation, for
example, when it is planning to hire a particular individual that meets
the required thresholds, would allow FINRA the opportunity to
meaningfully assess the underlying disciplinary events and review the
firm's supervisory practices and internal controls. The ability of
FINRA to conduct this review contemporaneously furthers investor
protection. Moreover, nothing in the proposed rule precludes FINRA from
taking enforcement action when necessary or appropriate.
[rtarr8] Definitions and Criteria That Would Require a Materiality
Consultation
    FINRA received numerous comments concerning the definitions in
proposed Rule 1011 of ``final criminal matter'' and ``specified risk
event'' and the criteria in proposed Rule 1017(a)(7) that would trigger
the need to request a materiality consultation. Some commenters
expressly supported the proposed definitions and criteria.\120\ FSI
wrote that the numeric parameters and proposed criteria are sound and
reasonable, and it supported how the ``specified risk events'' are
final and investment- or regulatory-related. NASAA wrote that the
proposed definition of ``final criminal matter'' appropriately captures
the scope of disclosable criminal events on the Uniform Registration
Forms. PIABA wrote that the criteria and definitions are appropriate
and clear enough to avoid confusion, and that the minor compliance
costs will be far outweighed by the increased investor protections.
---------------------------------------------------------------------------

    \120\ FSI, NASAA, PIABA.
---------------------------------------------------------------------------

    Other commenters suggested alternatives to the proposed definitions
and criteria. For example:
     Some commenters proposed that the definition of ``final
criminal matter'' include only investment- or fraud-related criminal
matters \121\ or matters that would generate a risk of customer
harm.\122\
---------------------------------------------------------------------------

    \121\ Luxor, Wulff Hansen.
    \122\ MML. This commenter also requested guidance concerning
whether ``final criminal matter'' would include situations where a
person receives a deferred sentence and can clear a conviction
through compliance with a court-ordered program. Per the proposed
definition, whether a ``final criminal matter'' would count for
purposes of proposed Rule 1017(a)(7) and IM-1011-3 would depend on
whether the matter ``is disclosed, or was required to be disclosed,
on the applicable Uniform Registration Forms.'' The setting aside of
a conviction does not necessarily mean that it need not be reported
on, or that the matter should be expunged from, the Uniform
Registration Forms. See, e.g., Form U4 and U5 Interpretive Questions
and Answers, http://www.finra.org/sites/default/files/Interpretive-Guidance-final-03.05.15.pdf (Questions 14A and 14B, Interpretive
Question and Answer 2, stating that ``[e]ach order setting aside a
conviction will be reviewed by RAD staff to determine if the
conviction must be reported'').
---------------------------------------------------------------------------

     Several commenters proposed that the definition of
``specified risk event'' use a dollar threshold that is either higher
\123\ or lower \124\ than $15,000.
---------------------------------------------------------------------------

    \123\ Cambridge, IBN, Janney, MML. Cambridge asserted that some
unfair high-risk characterizations resulting from a $15,000
threshold would involve control persons, principals and registered
persons who are required to disclose events due to a managerial role
but are ``likely not directly involved in'' the underlying
violations in those disclosed events. FINRA notes that the proposed
definition of ``specified risk event'' does not include final awards
or settlements where the person was not named but is only the
``subject of.''
    \124\ Better Markets.
---------------------------------------------------------------------------

     Some commenters proposed that the final awards and
settlements that are counted as ``specified risk events'' be broadened
\125\ or narrowed.\126\
---------------------------------------------------------------------------

    \125\ NASAA.
    \126\ Luxor, Network 1.
---------------------------------------------------------------------------

     Several commenters proposed changes to how ``specified
risk events'' would be counted.\127\
---------------------------------------------------------------------------

    \127\ Luxor, MML, Wulff Hansen.
---------------------------------------------------------------------------

     Some commenters suggested that lookback periods for events
that would trigger a materiality consultation be either shortened \128\
or increased.\129\
---------------------------------------------------------------------------

    \128\ Luxor.
    \129\ NASAA.
---------------------------------------------------------------------------

     Luxor wrote that additional factors should be included in
the criteria for whether a materiality consultation is required,
including the length of time the individual has been in the industry,

the number of events during that period, and the circumstances of those
events.
     Several commenters suggested narrowing the kinds of
business expansions that would require materiality consultations.\130\
---------------------------------------------------------------------------

    \130\ Janney, Luxor, MML, SIFMA, Wulff Hansen.
---------------------------------------------------------------------------

    After considering all the commenters' suggested alternative
definitions and criteria, FINRA has decided to retain the definitions
of ``final criminal matter'' and ``specified risk events'' and the
criteria that would trigger a materiality consultation that it proposed
in Regulatory Notice 18-16. Many of the comments concern issues that
FINRA already considered and addressed in the economic assessment in
Regulatory Notice 18-16, and the comments have not persuaded FINRA that
any changes to the definitions or criteria would be more efficient or
effective at addressing the potential for future customer harm
presented. As FINRA explained in Regulatory Notice 18-16, the primary
benefit of the proposed rule change would be to reduce the potential
risk of future customer harm by individuals who meet the proposed
criteria and seek to become an owner, control person, principal or
registered person of a member firm. The proposed rule change would
further promote investor protection by applying stronger standards for
changes to a current member firm's ownership, control or business
operations, including the potential that such changes would require the
filing and approval of a CMA. In developing this proposal, one of the
guiding principles was to provide transparency regarding the proposal's
application, so that firms could largely identify with available data
the specific set of disclosure events that would count towards the
proposed criteria and whether a proposed business change would trigger
the need for a materiality consultation. This is why FINRA's proposal
is based mostly on events disclosed on the Uniform Registration Forms,
which are generally available to firms and FINRA.
    While FINRA generally agrees with the comments that the proposed
materiality consultation process should account for situations where
numerous ``specified risk events'' are related,\131\ it does not
believe that modifying the rule-based criteria is the best way to do
so. Rather, FINRA believes the materiality consultation process should
allow it to assess an individual's particular events. Moreover, based
on experience gained through the materiality consultations, FINRA may
be able to develop guidance for the Department concerning situations
involving the ``specified risk events'' that could affect whether a
proposed business expansion is or is not material.
---------------------------------------------------------------------------

    \131\ MML, Wulff Hansen.
---------------------------------------------------------------------------

    Wulff Hansen suggested that a materiality consultation should be
required when a person having two or more ``specified risk events'' is
already associated with a member and seeks to become an owner or
control person. FINRA notes that the proposed rule already would
require materiality consultations for internal moves. As explained
above, however, the proposed rule would not apply when a person who
meets the proposed criteria in proposed Rule 1017(a)(7) is already a
principal at a member firm and seeks to add an additional principal
registration at that same firm. In that instance, the proposed rule
amendments would not require a materiality consultation.
[rtarr8] Materiality Consultation Procedures
    FSI and Janney requested that FINRA develop additional procedures
for the materiality consultation process. For example, these commenters
wrote that FINRA should establish time frames for FINRA staff to issue
a decision in a materiality consultation, with one commenter explaining
that time deadlines would allow firms to minimize litigation risks when
making hiring decisions. FSI asked that FINRA consider establishing
rule-based remedies for firms that disagree with FINRA staff's
materiality consultation decisions, and a rule-based requirement that
FINRA explain in writing a decision that requires a firm to file a
CMA.\132\ MML suggested that the proposed rule should outline the
issues that would be central to the Department's materiality
determination and clarify the proposed requirement that a member submit
a written letter to the Department in a ``manner prescribed by FINRA.''
---------------------------------------------------------------------------

    \132\ FSI also wrote that additional procedures would be
appropriate because the materiality consultations would be a rule-
based requirement, not voluntary.
---------------------------------------------------------------------------

    In general, FINRA believes that additional rule-based procedures
for the materiality consultation process would undermine its
informality, flexibility and expedited nature. By analogy, FINRA's
existing materiality consultation process has no written-decision
requirement and no appeal process. Nevertheless, FINRA believes it
would be helpful to provide guidance about the materiality consultation
process that would be required by the proposed rule, to supplement the
already published guidance about FINRA's existing materiality
consultation process.\133\ For that reason, FINRA has explained in
detail--both in Regulatory Notice 18-16 and above--the kinds of
information that the firm should provide when seeking a materiality
consultation required by proposed Rule 1017(a)(7) and what information
would be relevant to the Department's materiality decision. FINRA also
will provide more guidance as necessary as to what firms should provide
when seeking the materiality consultation required by the proposed rule
amendments.
---------------------------------------------------------------------------

    \133\ See The Materiality Consultation Process for CMAs, https://www.finra.org/rules-guidance/guidance/materiality-consultation-process. FINRA's existing guidance provides that a materiality
consultation submission should include, but is not limited to, the
following: (i) A description of the proposed change in business
sufficient for staff to understand the scope of the business and how
it will be conducted; (ii) why the firm believes that the proposed
new business or product is similar in scope or nature to their
existing business; (iii) the anticipated impact the change will have
to the firm's supervisory structure; (iv) any impact the proposed
change will have to the firm's capital or liquidity; (v) the nature
and scope of updates required to written supervisory procedures,
systems and firm operations; (vi) any recent disciplinary matters
that relate to the proposed activities as well as how the firm's
overall regulatory history may impact the ability of the firm to
effectively conduct the activity; and (vii) any relevant
documentation to support the proposal.
---------------------------------------------------------------------------

Miscellaneous Comments
    SIFMA requested that FINRA provide a notification to firms of
registered persons who have ``specified risk events,'' similar to how
FINRA provides information gathered in its public records searches for
information relating to bankruptcies, judgments and liens, asserting
that individuals may not identify and disclose ``specified risk
events'' to firms in a timely manner. FINRA appreciates this
suggestion, but notes that the events included in the definition are
derived from the Uniform Registration Forms and, therefore, firms
should generally be able to conduct appropriate due diligence to
identify such individuals. Indeed, FINRA Rule 3110(e) already requires
firms to establish and implement written procedures reasonably designed
to verify the accuracy and completeness of the information contain in
an applicant's initial or transfer Form U4, which would include
verifying the accuracy and completeness of answers and disclosures
concerning ``final criminal matters'' and the events covered by the
definition of ``specified risk events.''
    Cambridge commented that persons should have the opportunity to
confidentially submit an application seeking a materiality consultation
to ``pre-qualify'' a transition from one firm

to another and gain confidence that they are free to make such a
transfer. FINRA does not believe, however, that prequalification of a
person with a significant history of misconduct would be appropriate,
or even possible, in the absence of additional information about, among
other things, the specific context in which the person would be
associated with a new firm and the activities and history of such
proposed new firm.
    Better Markets opined that the proposed rule change would reflect
an improvement over the status quo but is still insufficient, and that
FINRA should do more to reduce the number of brokers with a significant
history of misconduct and the prevalence of recidivism. Specifically,
Better Markets wrote that FINRA should ban brokers with two criminal
convictions or three ``specified risk events'' at a $5,000 level
(instead of the proposed $15,000 level) and immediately and permanently
expel a firm where more than 20% of its brokers have three or more
``specified risk events.'' Better Markets also suggested that FINRA
engage in more investor education on the topic of recidivist brokers,
design a user-friendly disclosure system that clearly identifies
brokers with a demonstrable pattern of violations, and repeal the part
of FINRA Rule 9311 that stays a Hearing Panel or Hearing Officer
decision pending an appeal to the NAC.
    FINRA's efforts to address the risks posed by brokers with a
significant history of misconduct are ongoing, and FINRA appreciates
comments on additional steps that FINRA might take. Some of Better
Markets' suggestions, however, amount to a request that FINRA create
new categories of ``statutory disqualification.'' Federal law defines
the types of misconduct that presumptively disqualify a broker from
associating with a firm, and amending what qualifies as a statutory
disqualification is beyond FINRA's jurisdiction. In addition, FINRA
does not agree that repealing the provision in Rule 9311(b) that stays
the effect of a Hearing Panel or Hearing Officer decision would be
appropriate at this time. FINRA's rule that stays the effect of a
Hearing Panel or Hearing Officer decision is consistent with rules of
other self-regulatory organizations and the SEC.\134\ Moreover, the
proposed rule change would protect investors during a disciplinary
appeal by empowering Hearing Officers to impose conditions and
restrictions that they consider reasonably necessary for the purpose of
preventing customer harm.
---------------------------------------------------------------------------

    \134\ See, e.g., 17 CFR 201.360(d) (providing that an SEC ALJ's
initial decision shall not become final as to a party or person who
timely files a petition for review); CBOE Rule 13.11(b) (providing
that sanctions shall not become effective until the Exchange review
process is completed or the decision otherwise becomes final);
NASDAQ PHLX Rule 9311(b) (providing that an appeal to the Exchange
Review Council from a disciplinary decision shall operate as a stay
until the Exchange Review Council issues a decision); NYSE CHX
Article 12, Rule 6 (providing that the enforcement of any orders or
penalties shall be stayed upon the filing of a notice of appeal
pending the outcome of final review by a Judiciary Committee or the
Board of Directors).
---------------------------------------------------------------------------

Miscellaneous Comments Outside the Scope of the Proposal
    Some comments raised concerns regarding broader issues, such as
arbitration proceedings and public disclosure of arbitration
settlements,\135\ the composition of Hearing Panels in FINRA's
disciplinary proceedings,\136\ questions about whether firms are
permitted to pay disqualified persons consistent with FINRA Rule
8311,\137\ various Constitutional protections that FINRA should adopt
in investigations and disciplinary proceedings,\138\ and how FINRA
might improve the Taping Rule to prevent non-compliance with that
rule.\139\ FINRA believes, however, that these comments are all outside
the scope of the proposal.
---------------------------------------------------------------------------

    \135\ IBN suggested that FINRA should have local arbitration
hearings, with panels composed of local representatives and local
firms, and that FINRA should eliminate mandatory arbitration or
require arbitrators to be lawyers and follow the rule of law.
Network 1 commented that FINRA should consider the ``prejudicial
effect'' on brokers of the six-year limitations period for filing an
arbitration claim and of nuisance-value arbitration actions brought
by non-attorney representatives; that references to arbitration
claims brought by a non-attorney representative that are settled or
that result in an award in favor of the broker should be removed
from the broker's public record; and that an arbitration claim
brought by a non-attorney representative that results in a
settlement should not be made available to the public at all.
    \136\ Network 1 commented that FINRA adjudicatory panels should
include one attorney with a demonstrated history of representing
brokers or member firms, securities industry experience, and
knowledge of securities laws, regulations and rules and industry
practices in the investment banking and securities businesses. It
also commented that FINRA should establish a process for soliciting
``bona fide neutrals'' to sit on adjudicatory panels.
    \137\ Network 1.
    \138\ Network 1.
    \139\ NASAA.
---------------------------------------------------------------------------

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-FINRA-2020-011 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-FINRA-2020-011. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549, on official business days between the hours of 10 a.m. and 3
p.m. Copies of such filing also will be available for inspection and
copying at the principal office of FINRA. All comments received will be
posted without change. Persons submitting comments are cautioned that
we do not redact or edit personal identifying information from comment
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-
FINRA-

2020-011 and should be submitted on or before May 5, 2020.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\140\
---------------------------------------------------------------------------

    \140\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-07777 Filed 4-13-20; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 41 (Friday, March 1, 2019)]
[Notices]
[Pages 7091-7092]
[FR Doc No: 2019-03650]

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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

[Docket No. USCG-2018-1043]

Collection of Information Under Review by Office of Management
and Budget; OMB Control Number: 1625-0099

AGENCY: Coast Guard, DHS.

ACTION: Thirty-day notice requesting comments.

-----------------------------------------------------------------------

SUMMARY: In compliance with the Paperwork Reduction Act of 1995 the
U.S. Coast Guard is forwarding an Information Collection Request (ICR),
abstracted below, to the Office of Management and Budget (OMB), Office
of Information and Regulatory Affairs (OIRA), requesting an extension
of its approval for the following collection of information: 1625-0099,
Requirements for the Use of Liquefied Petroleum Gas and Compressed
Natural Gas as Cooking Fuel on Passenger Vessels; without change. Our
ICR describes the information we seek to collect from the public.
Review and comments by OIRA ensure we only impose paperwork burdens
commensurate with our performance of duties.

DATES: Comments must reach the Coast Guard and OIRA on or before April
1, 2019.

ADDRESSES: You may submit comments identified by Coast Guard docket
number [USCG-2018-1043] to the Coast Guard using the Federal
eRulemaking Portal at https://www.regulations.gov. Alternatively, you
may submit comments to OIRA using one of the following means:
    (1) Email<EMAIL_ADDRESS>    (2) Mail: OIRA, 725 17th Street NW, Washington, DC 20503, attention
Desk Officer for the Coast Guard.
    A copy of the ICR is available through the docket on the internet
at https://www.regulations.gov. Additionally, copies are available
from: Commandant (CG-612), Attn: Paperwork Reduction Act Manager, U.S.
Coast Guard, 2703 Martin Luther King Jr Ave SE, Stop 7710, Washington,
DC 20593-7710.

FOR FURTHER INFORMATION CONTACT: Contact Mr. Anthony Smith, Office of
Information Management, telephone<PHONE_NUMBER>, or fax<PHONE_NUMBER>,
for questions on these documents.

SUPPLEMENTARY INFORMATION:

Public Participation and Request for Comments

    This notice relies on the authority of the Paperwork Reduction Act
of 1995; 44 U.S.C. Chapter 35, as amended. An ICR is an application to
OIRA seeking the approval, extension, or renewal of a Coast Guard
collection of information (Collection). The ICR contains information
describing the Collection's purpose, the Collection's likely burden on
the affected public, an explanation of the necessity of the Collection,
and other important information describing the Collection. There is one
ICR for each Collection. The Coast Guard invites comments on whether
this ICR should be granted based on the Collection being necessary for
the proper performance of Departmental functions. In particular, the
Coast Guard would appreciate comments addressing: (1) The practical
utility of the Collection; (2) the accuracy of the estimated burden of
the Collection; (3) ways to enhance the quality, utility, and clarity
of information subject to the Collection; and (4) ways to minimize the
burden of the Collection on respondents, including the use of automated
collection techniques or other forms of information technology.
Consistent with the requirements of Executive Order 13771, Reducing
Regulation and Controlling Regulatory Costs, and Executive Order 13777,
Enforcing the Regulatory Reform agenda, the Coast Guard is also
requesting comments on the extent to which this request for information
could be modified to reduce the burden on respondents. These comments
will help OIRA determine whether to approve the ICR referred to in this
notice.
    We encourage you to respond to this request by submitting comments
and related materials. Comments to Coast Guard or OIRA must contain the
OMB Control Number of the ICR. They must also contain the docket number
of this request, [USCG-2018-1043], and must be received by April 1,
2019.

Submitting Comments

    We encourage you to submit comments through the Federal eRulemaking
Portal at https://www.regulations.gov. If your material cannot be
submitted using https://www.regulations.gov, contact the person in the
FOR FURTHER INFORMATION CONTACT section of this document for alternate
instructions. Documents mentioned in this notice, and all public
comments, are in our online docket at https://www.regulations.gov and
can be viewed by following that website's instructions. Additionally,
if you go to the online docket and sign up for email alerts, you will
be notified when comments are posted.
    We accept anonymous comments. All comments received will be posted
without change to https://www.regulations.gov and will include any
personal information you have provided. For more about privacy and the
docket, you may review a Privacy Act notice regarding the Federal
Docket Management System in the March 24, 2005, issue of the Federal
Register (70 FR 15086).
    OIRA posts its decisions on ICRs online at https://www.reginfo.gov/public/do/PRAMain after the comment period for each ICR. An OMB Notice
of Action on each ICR will become available via a hyperlink in the OMB
Control Number: 1625-0099.

Previous Request for Comments

    This request provides a 30-day comment period required by OIRA. The
Coast Guard published the 60-day notice (83 FR 58269, November 19,
2018) required by 44 U.S.C. 3506(c)(2). That notice elicited no
comments. Accordingly, no changes have been made to the Collections.

Information Collection Request

    Title: Requirements for the Use of Liquefied Petroleum Gas and
Compressed Natural Gas as Cooking Fuel on Passenger Vessels.
    OMB Control Number: 1625-0099.
    Summary: The collection of information requires passenger vessels
to post two placards that contain safety and operating instructions on
the use of cooking appliance that use liquefied gas or compressed
natural gas.
    Need: Title 46 U.S.C. 3306(a)(5) authorizes the Coast Guard to
prescribe regulations for the use of vessel stores of a dangerous
nature. These regulations are prescribed in both uninspected and
inspected passenger vessel regulations.
    Forms: None.
    Respondents: Owners and operators of passenger vessels.
    Frequency: On occasion.
    Hour Burden Estimate: The estimated burden has increased from 6,429
hours to 6,758 hours a year due to an increase in the estimated annual
number of respondents.

    Authority: The Paperwork Reduction Act of 1995; 44 U.S.C.
Chapter 35, as amended.

    Dated: February 21, 2019.
James D. Roppel,
U.S. Coast Guard, Chief, Office of Information Management.
[FR Doc. 2019-03650 Filed 2-28-19; 8:45 am]
BILLING CODE 9110-04-P


[Federal Register: January 24, 2008 (Volume 73, Number 16)]
[Rules and Regulations]
[Page 4070-4071]
[DOCID:fr24ja08-12]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Docket No. FAA-2007-29375; Airspace Docket No. 07-AEA-06]

Amendment of Class E Airspace; State College, PA

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Direct final rule; correction, confirmation of effective date.

-----------------------------------------------------------------------

SUMMARY: The Federal Aviation Administration published in the Federal
Register of October 30, 2007, (72 FR 61293-61294), a document amending
Class E airspace at State College, PA. This action technically corrects
the geographical coordinates of the University Park Airport, adds the
coordinates for the University Park Airport, adds the coordinates for
the Instrument Landing System's (ILS) Localizer (LOC) and confirms the
effective date of the direct final rule that amends Class E airspace to
support an Instrument Approach Procedure serving the Centre Community
Hospital (PS57), State College, PA.

DATES: Effective 0901 UTC, December 20, 2007. The Director of the
Federal Register approves this incorporation by reference action under
Title 1, Code of Federal Regulations, part 51, subject to the annual
revision of FAA Order 7400.9 and publication of conforming amendments.

FOR FURTHER INFORMATION CONTACT: Daryl Daniels, Airspace Specialist,
System Support, AJO2-E2B.12, FAA Eastern Service Center, 1701 Columbia
Ave., College Park, GA 30337; telephone<PHONE_NUMBER>; fax (404) 305-
5572.

SUPPLEMENTARY INFORMATION:

Confirmation of Effective Date

    The FAA published this direct final rule with a request for
comments in the Federal Register on October 30 (72 FR 61293) amending
Class E airspace to support a Special Copter Point in Space Instrument
Approach Procedure into the Centre Community Hospital (PS57). The FAA
uses the direct final rulemaking procedure for a non controversial rule
where the FAA believes that there will be no adverse public comment.
This direct final rule advised the public that no adverse comments were
anticipated, and that unless a written adverse comment, or a written
notice of intent to submit such an adverse comment, were received
within the comment period, the regulation would become effective on
December 20, 2007. No adverse comments were received, and thus this
notice confirms that this direct final rule will become effective on
that date.

Correction to Final Rule

0
After publication, it was observed that a technical correction was
required to correct the geographical coordinates for the University
Park Airport and to add the University Park Airport's ILS LOC with its
coordinates to the legal description. Therefore, in the Federal
Register Docket No. FAA-2007-29375; Airspace Docket No. 07-AEA-06,
published October 10, 2007, (72 FR 61293-61294) make the following
correction. On page 61294, in the second column, immediately under
``University Park Airport, State College, PA'', correct the
geographical coordinates to read ``(lat. 40[deg]50'57'' N., Long.
77[deg]50'55'' W.)'' On the next line add the following:

University Park Airport ILS LOC
    (Lat. 40[deg]50'38'' N., long. 77[deg]51'30'' W.)

0
For verification and to avoid confusion, the entire description should
read as follows:

Paragraph 6005 Class E Airspace Areas Extending Upward from 700 feet
or More Above the Surface of the Earth.
* * * * *

AEA PA E5 State College, PA [AMENDED]

University Park Airport, State College, PA
    (Lat. 40[deg]50'57'' N., long. 77[deg]50'55'' W.)
University Park Airport ILS LOC
    (Lat. 40[deg]50'38'' N., long. 77[deg]51'30'' W.)
PENUE NDB
    (Lat. 40[deg]54'37'' N., long. 77[deg]44'30'' W.)
Centre Community Hospital, State College, PA
    Point in Space Coordinates
    (Lat. 40[deg]49'14'' N., long. 77[deg]49'44'' W.)

    That airspace extending upward from 700 feet above the surface
within a 6.5-mile radius of University Park Airport and within 3.1
miles each side of the University Park Airport ILS Runway 24
localizer course extending from the PENUE NDB to 9.2 miles northeast
of the NDB; and that airspace within a 6-mile radius of the point in
space (Lat. 40[deg]49'14'' N., long. 77[deg]49'44'' W.) serving the
Centre Community Hospital.
* * * * *

    Issued in College Park, GA, on December 17, 2007.
Mark D. Ward,
Manager, System Support Group, Eastern Service Center.
[FR Doc. 08-205 Filed 1-23-08; 8:45 am]

BILLING CODE 4910-13-M


Cooling Water Intake Structure ( CWIS) Information Data Required Rig Information Rig Name ENSCO 83 ENSCO 90 ENSCO 84 ENSCO 93 ENSCO 85 ENSCO 98 ENSCO 86 ENSCO 99 ENSCO 88 ENSCO 89 Rig Type Jackup Marathon LeTourneau 83SD C Total Installed Power Generation Capacity 4950 hp Number of Cooling Water Intake Structures ( CWISs) 4 Brief description of each CWIS ( e. g., sea chest, simple pipe) Sea chest, raw water tower deep well pumps Rough dimensions of each CWIS and indicate whether onboard CWIS has an existing flange 3 raw water tower pumps, 2 stage w/ 75 hp motors pump rated 1200 gpm 1 Sea chest used only while under tow Screen type ( e. g., strainer, wedge wire) with mesh size Basket Strainers, ¼ " Mesh on pump itself Total Design Specifications for Daily Maximum Water Intake Volume of each CWIS 1,727,964 gals ( 41,142 bbls)

Total Daily Water Intake Volume of each CWIS ( Set up/ Drilling) 1,727,964 gals ( 41,142 bbls)

Design Specs for Through Screen Velocity of each CWIS ( i. e., Q= V* A) ( Set up/ Drilling) 13.33 ft/ second List of Purposes of Cooling Water Intakes ( e. g., cool crude oil, produced water, power generators, drill pipe brakes) Brake water cooling List of Purposes of Non cooling Water Intakes ( e. g., fire water, hotel loads) Water makers, fire main, sanitary, pre load, jet spud cans, mud pits, shakers Total Volume of Water Intake for Ballasting, Duration of the Ballast intake, and the Through Screen Velocity of the Ballast intake 2,110,500 gals ( 50,250 bbls) to 2,587,200 gals ( 61,600 bbls) Duration = time on location. Through Screen Velocity = 13.33 ft. Per second Mitigation Measures for reducing Exotic Species Migration through Ballast water The rig does not carry much ballast water from location to location. It is taken on and dumped at the same location. Mitigation Measures for reducing Impingement and Entrainment of Aquatic Organisms, as well as Bio fouling Prevention Measures Sea chest screens, and baskets, cathodic protection Is the Rig equipped with a Radiator Cooling System for the Main Engines? Yes, 3 Radiators for the engines


[Federal Register Volume 83, Number 220 (Wednesday, November 14, 2018)]
[Notices]
[Pages 56896-56897]
[FR Doc No: 2018-24855]

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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

[Docket No. FMCSA-2018-0319]

Qualification of Drivers; Exemption Applications; Implantable
Cardioverter Defibrillators

AGENCY: Federal Motor Carrier Safety Administration (FMCSA), DOT.

ACTION: Notice of applications for exemption; request for comments.

-----------------------------------------------------------------------

SUMMARY: FMCSA announces receipt of applications from four individuals
for an exemption from the prohibition in the Federal Motor Carrier
Safety Regulations (FMCSRs) against operation of a commercial motor
vehicle (CMV) by persons with a current clinical diagnosis of
myocardial infarction, angina pectoris, coronary insufficiency,
thrombosis, or any other cardiovascular disease of a variety known to
be accompanied by syncope, dyspnea, collapse, or congestive heart
failure. If granted, the exemptions would enable these individuals with
implantable cardioverter defibrillators (ICDs) to operate CMVs in
interstate commerce.

DATES: Comments must be received on or before December 14, 2018.

ADDRESSES: You may submit comments identified by the Federal Docket
Management System (FDMS) Docket ID FMCSA-2018-0319 using any of the
following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting
comments.
     Mail: Docket Management Facility; U.S. Department of
Transportation, 1200 New Jersey Avenue SE, West Building Ground Floor,
Room W12-140, Washington, DC 20590-0001.
     Hand Delivery: West Building Ground Floor, Room W12-140,
1200 New Jersey Avenue SE, Washington, DC, between 9 a.m. and 5 p.m.,
ET, Monday through Friday, except Federal Holidays.
     Fax: 1-202-493-2251.
    To avoid duplication, please use only one of these four methods.
See the ``Public Participation'' portion of the SUPPLEMENTARY
INFORMATION section for instructions on submitting comments.

FOR FURTHER INFORMATION CONTACT: Ms. Christine A. Hydock, Chief,
Medical Programs Division,<PHONE_NUMBER>, [email protected], FMCSA,
Department of Transportation, 1200 New Jersey Avenue SE, Room W64-
224,Washington, DC 20590-0001. Office hours are from 8:30 a.m. to 5
p.m., ET, Monday through Friday, except Federal holidays. If you have
questions regarding viewing or submitting material to the docket,
contact Docket Services, telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Public Participation

A. Submitting Comments

    If you submit a comment, please include the docket number for this
notice (Docket No. FMCSA-2018-0319), indicate the specific section of
this document to which each comment applies, and provide a reason for
each suggestion or recommendation. You may submit your comments and
material online or by fax, mail, or hand delivery, but please use only
one of these means. FMCSA recommends that you include your name and a
mailing address, an email address, or a phone number in the body of
your document so that FMCSA can contact you if there are questions
regarding your submission.
    To submit your comment online, go to http://www.regulations.gov,
put the docket number, FMCSA-2018-0319, in the keyword box, and click
``Search.'' When the new screen appears, click on the ``Comment Now!''
button and type your comment into the text box on the following screen.
Choose whether you are submitting your comment as an individual or on
behalf of a third party and then submit.
    If you submit your comments by mail or hand delivery, submit them
in an unbound format, no larger than 8\1/2\ by 11 inches, suitable for
copying and electronic filing. If you submit comments by mail and would
like to know that they reached the facility, please enclose a stamped,
self-addressed postcard or envelope.
    FMCSA will consider all comments and material received during the
comment period.

B. Viewing Documents and Comments

    To view comments, as well as any documents mentioned in this notice
as being available in the docket, go to http://www.regulations.gov.
Insert the docket number, FMCSA-2018-0319, in the keyword box, and
click ``Search.'' Next, click the ``Open Docket Folder'' button and
choose the document to review. If you do not have access to the
internet, you may view the docket online by visiting the Docket
Management Facility in Room W12-140 on the ground floor of the DOT West
Building, 1200 New Jersey Avenue SE, Washington, DC 20590, between 9
a.m. and 5 p.m., ET, Monday through Friday, except Federal holidays.

C. Privacy Act

    In accordance with 5 U.S.C. 553(c), DOT solicits comments from the
public to better inform its rulemaking process. DOT posts these
comments, without edit, including any personal information the
commenter provides, to www.regulations.gov, as described in the system
of records notice (DOT/ALL-14 FDMS), which can be reviewed at
www.dot.gov/privacy.

II. Background

    Under 49 U.S.C. 31136(e) and 31315, FMCSA may grant an exemption
from the FMCSRs for a five-year period if it finds such exemption would
likely achieve a level of safety that is equivalent to, or greater
than, the level that would be achieved absent such exemption. The
statute also allows the Agency to renew exemptions at the end of the
five-year period. FMCSA grants exemptions from the FMCSRs for a two-
year period to align with the maximum duration of a driver's medical
certification.
    The four individuals listed in this notice have requested an
exemption from 49 CFR 391.41(b)(4). Accordingly, the Agency will
evaluate the qualifications of each applicant to determine whether
granting the exemption will achieve the required level of safety
mandated by statute.
    The physical qualification standard found in 49 CFR 391.41(b)(4)
states that a person is physically qualified to drive a CMV if that
person has no current clinical diagnosis of myocardial infarction,
angina pectoris, coronary insufficiency, thrombosis, or any other
cardiovascular disease of a variety known to be accompanied by syncope,
dyspnea, collapse, or congestive cardiac failure.
    In addition to the regulations, FMCSA has published advisory
criteria \1\ to assist Medical Examiners in determining whether drivers
with certain medical conditions are qualified to operate a CMV in
interstate commerce. [49 CFR part 391, APPENDIX A TO PART 391--MEDICAL
ADVISORY CRITERIA, section D. Cardiovascular: Sec.  391.41(b)(4),
paragraph 4.] The advisory criteria states that ICDs are disqualifying
due to risk of syncope.
---------------------------------------------------------------------------

    \1\ See http://www.ecfr.gov/cgi-bin/text-idx?SID=e47b48a9ea42dd67d999246e23d97970&mc=true&node=pt49.5.391&rgn=div5#ap49.5.391_171.a and https://www.gpo.gov/fdsys/pkg/CFR-2015-title49-vol5/pdf/CFR-2015-title49-vol5-part391-appA.pdf.
---------------------------------------------------------------------------

III. Qualifications of Applicants

Herman L. Bolton

    Mr. Bolton is a Class A CDL holder in Louisiana. A June 29, 2018
report from Mr. Bolton's cardiologist states his ICD was implanted
August 25, 2017, and that Mr. Bolton reports no complaints of syncope.

Robert A. Crawley

    Mr. Crawley is a commercial motor vehicle driver in Maryland. A
September 13, 2018, report from his cardiologist states his ICD was
implanted August 24, 2016, and that he denies any symptoms of device
malfunction, arrhythmia recurrence, palpitations, syncope, or shocks.

Paul J. Hill

    Mr. Hill is a commercial motor vehicle driver in South Dakota. A
September 25, 2018 letter from Mr. Hill's electrophysiologist reports
that his ICD was implanted November 27, 2013, and that he has been
stable and has not had any shocks from his device.

Johnny L. Walls, Jr.

    Mr. Walls is Class A CDL holder in Alabama. A September 7, 2018
letter from his electrophysiologist reports that his ICD was implanted
August 13, 2018 and he has had no shocks since his hospital discharge
on August 22, 2018.

IV. Request for Comments

    In accordance with 49 U.S.C. 31136(e) and 31315, FMCSA requests
public comment from all interested persons on the exemption petitions
described in this notice. We will consider all comments received before
the close of business on the closing date indicated in the dates
section of the notice.

    Issued on: November 5, 2018.
Larry W. Minor,
Associate Administrator for Policy.
[FR Doc. 2018-24855 Filed 11-13-18; 8:45 am]
 BILLING CODE 4910-EX-P