Last week the SEC approved new FINRA Rule 3290, a major overhaul of how FINRA regulates registered representatives’ outside activities. The new rule combines the existing outside business activity and private securities transaction rules into one rule and shifts towards a more risk-based approach.
How Does FINRA Rule 3290 Change Outside Business Activity Requirements?
Under the previous framework, reps generally had to disclose all outside business activities even when they had little or nothing to do with investments. Driving for Uber/Lyft, bartending, or getting paid to coach youth sports could all require disclosure and firm approval.
Rule 3290 narrows the focus to outside investment-related activities. The new rule allows firms to spend less time, money, and resources reviewing low-risk side jobs and more time focused on activities that could create conflicts, customer confusion, or investor harm.
What Happens to Private Securities Transactions Under Rule 3290?
Rule 3290 also brings outside securities transactions into the same overall outside-activities framework rather than maintaining a separate rule for private securities transactions.
This is important for registered representatives involved in securities activities away from their broker-dealer. Depending on the circumstances, prior notice, firm assessment, approval, supervision, and recordkeeping requirements may apply.
The consolidation is intended to create a more consistent framework for evaluating outside activities while preserving heightened requirements for securities transactions that present greater risks.
How Does Rule 3290 Affect Investment Advisory Activities at an Unaffiliated RIA?
The rule change would also eliminate members’ supervision and record-keeping obligations for investment advisory activities performed by associated persons at unaffiliated RIAs. A requirement that has long been criticized by industry participants.
FINRA’s position is that requiring one regulated firm to supervise activity conducted through another regulated firm was often duplicative and impractical, although some critics believe this change may remove a necessary layer of investor protection.
Overall, Rule 3290 moves the industry toward a more practical, risk-based approach: less attention on low-risk outside employment, more focus on investment-related activity, and no ongoing broker-dealer supervision of advisory trades conducted through an unaffiliated RIA. The rule has been approved by the SEC but is not yet effective. FINRA will announce the implementation date separately.
Compliance Infrastructure for Financial Professionals
As FINRA moves toward a more risk-based regulatory framework, financial professionals still need the infrastructure to manage registration, supervision, compliance, and ongoing regulatory requirements.
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Explore FNEX Compliance ServicesFINRA Rule 3290
FINRA Rule 3290 is the new Outside Activities Requirements rule. It replaces FINRA Rules 3270 and 3280 and establishes a consolidated framework for certain outside activities and outside securities transactions conducted by registered and associated persons.
Yes. Rule 3290 will replace FINRA Rule 3270, which governs outside business activities of registered persons, as well as FINRA Rule 3280, which governs private securities transactions.
The new rule significantly narrows the scope compared with the existing outside business activity framework. Its requirements focus on specified outside activities that FINRA considers more relevant to broker-dealer oversight and potential investor risks. The requirements applicable to a particular activity depend on its nature and circumstances.
Yes. Outside securities transactions are incorporated into Rule 3290 rather than being governed separately under Rule 3280. Requirements can vary depending on the transaction and whether compensation is involved.
Under the new framework, certain investment advisory activities conducted through an unaffiliated RIA will no longer carry the same ongoing broker-dealer supervision and recordkeeping obligations. Notice and assessment requirements can still apply.
The SEC approved FINRA Rule 3290 on September 15, 2026, but the rule is not yet effective. FINRA will announce the effective date separately in a Regulatory Notice.
Independent investment bankers conducting securities business generally need an appropriate broker-dealer and compliance framework. FNEX Compliance Services provides broker-dealer affiliation, compliance support, and supervisory infrastructure for financial professionals operating within the securities industry.
