FINRA Regulatory Notice 24-09 — Member Firm Obligations for AI Tools
United States · FINRA Reg. Notice 24-09 (June 27, 2024)
FINRA reminded broker-dealers that existing rules — supervision, recordkeeping, advertising, and anti-fraud — apply fully to AI tools, including generative AI used for customer communications, surveillance, and trading. Firms misrepresenting AI capabilities or failing to supervise AI outputs face enforcement.
Technical detail
FINRA Reg. Notice 24-09 (June 27, 2024) reiterates that Rules 2210 (communications), 3110 (supervision), 4511 (books and records), 2010 (standards of commercial honor), and the SEC anti-fraud regime apply to AI applications including LLMs. Firms must address hallucinations, IP risks, and customer-data confidentiality in supervisory procedures.
Who is protected: Retail investors and broker-dealer clients
Who must comply: FINRA-registered broker-dealers and associated persons
Key facts
| Jurisdiction | United States |
|---|---|
| Level | Federal |
| Status | In effect |
| Protection strength | Limited protection |
| Effective date | 2024-06-27 |
| Enacted | 2024-06-27 |
| Citation | FINRA Reg. Notice 24-09 (June 27, 2024) |
| Enforced by | Financial Industry Regulatory Authority |
| Private right of action | No — agency enforcement only |
| Penalties | FINRA fines, suspensions, expulsions, and disgorgement |
| Topics | consumer protection · automated decision-making · AI disclosure and transparency |
| Last verified | 2026-06-17 |
| Official source | Regulatory Notice 24-09 — Firms' Obligations in the Use of Generative AI and Large Language Models ↗ |
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- NAIC AI Evaluation Tool Pilot (12 states, 2026) · Proposed / pending
- FTC Proposed Policy Statement — AI Accuracy (July 2026) · Proposed / pending
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- Arkansas Frank Broyles Act AI amendment — voice and likeness protection (2025) · In effect
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