FiSolve Weekly News Digest: November 7, 2025

Here is what we are reading in the news this week...

FINRA Fines Firm $10 Million for Violations Relating to Gifts and Entertainment

FINRA censured and fined a firm $10 million for providing excessive non-cash compensation (e.g., gifts, meals, and entertainment) in connection with the distribution of its Investment Company Act securities and related misconduct.  FINRA found the firm provided gifts, meals and entertainment to representatives of retail broker-dealers (client firms) that sold its investment company securities, which significantly exceeded FINRA limits for non-cash compensation.  In certain situations, the firm preconditioned non-cash compensation on client firm representatives achieving sales targets with respect to the firm’s products (e.g., exchange-traded funds and unit investment trusts).  In addition, FINRA found the firm’s wholesalers were found to have falsified internal expense records, and sent client firms reports containing inaccurate information about the value, nature and frequency of non-cash compensation that provided to client firm representatives.  Read more here.

Report Finds AI Boosts Productivity by the Equivalent of One Workday Per Week

According to new research from the London School of Economics' Inclusion Initiative (TII), in collaboration with global consulting firm Protiviti, employees who use artificial intelligence (AI) are saving the equivalent of a full working day every week.  Despite this significant potential, the report finds most employees (68%) have received no AI training in the past 12 months, leaving substantial efficiency gains unrealized.  Interestingly, the report notes more than 78% of organizations are investing in generative AI technologies for their employees, but up to 42% of those initiatives are being abandoned before reaching their intended purpose.  Read more here.

Cyber Threat Intelligence Firm Warns of Impersonation and Spoofing Vulnerabilities with Microsoft Teams

A report by Check Point Research uncovered four vulnerabilities in Microsoft Teams that allow attackers to impersonate executives, manipulate messages, alter notifications, and forge identities in video and audio call.  The report finds risks include executive impersonation, financial fraud, malware delivery, misinformation campaigns, and disruption of sensitive communications.  The report notes Check Point Research disclosed the vulnerabilities to Microsoft on March 23, 2024.  Microsoft reportedly acknowledged the report, investigated, and subsequently issued fixes for the reported issues.  By the end of October 2025, all vulnerabilities had been resolved.  Read more here.

FCA Publishes Review of Consolidation in Financial Advice and Wealth Management Sector

In a review focused on groups acquiring financial advisers and wealth management firms, the Financial Conduct Authority examined how these groups manage risks, debt, governance and integration during and after acquisitions.  The review found consolidation can support efficiency and sustainable growth.  But, if not effectively managed, consolidation could lead to poor outcomes for consumers, employees and, more broadly, the wider financial system.  Good practice identified in the review included clear group structures, strong governance, effective monitoring of group debt and comprehensive risk management across all entities.  Firms that demonstrated well-planned acquisition strategies and thorough integration planning were also more likely to deliver positive outcomes for customers.  The review also highlighted areas with greater potential for harm. These included how groups were structured and how group debt was guaranteed.  Read more here.

ESMA Finds Distribution Costs Account for Almost ½ the Total Costs Paid to Invest in UCITS

The European Securities and Markets Authority (ESMA) has published a report on total costs of investing in UCITS and AIFs.  Notably, the report provides an innovative analysis on distribution costs, which account for 48% of total costs for UCITS.  These high costs are primarily driven by the traditional and dominant role of credit institutions and investment firms in the distribution chain across many Member States.  In contrast, digital platforms - such as neo-brokers offering execution-only services - are less expensive.  The report also confirms that inducements play a central role in ongoing costs. When there are inducement agreements between the distributor and the manufacturer of a UCITS (non-independent advice), these payments account for up to 45% of the ongoing costs.  Access the report here.

SEC Issues Exemptive Order Regarding Compliance

with Regulation NMS Rule Updates

The Securities and Exchange Commission issued an order granting temporary exemptive relief from certain compliance dates adopted under Regulation NMS: Minimum Pricing Increments, Access Fees and Transparency of Better Priced Orders.  Rules 600(b)(89)(i)(F) and 612 of Regulation NMS implementing the amended minimum pricing increment and Rule 610(c) of Regulation NMS implementing the amended access fee caps have been extended through November 2, 2026 and Rule 610(d) of Regulation NMS implementing the requirement that exchange fees be determinable at the time of execution has been extended to February 2, 2026.  Read more here. 

Federal Government Shutdown Approaches Day 40,

Flight Operations Reduced

As the government shutdown is heading towards a sixth week, there is no indication of an imminent resolution.  The Federal Aviation Administration will begin reducing flight capacity by 10% at 40 major airports across the country.  As a reminder the U.S. Securities and Exchange Commission published its Operational Plan during the shutdown and many of the SEC’s Divisions have provided guidance specific to their function.  You may access these materials from the SEC’s home page at www.sec.gov.  Other agencies have published guidance as well.

FiSolve and Eversheds Sutherland to Host AI Roundtable

FiSolve and Eversheds Sutherland will be hosting a roundtable on Navigating Artificial Intelligence (AI) in the Investment Services Industry.  This in-person event is scheduled for 8:15 AM – 10:00 AM in New York City on November 13, 2025.  Please contact us at info@FiSolve.com if you are interested in attending the event.

‼️FiSolve's Negotiation Tip of the Week‼️

Making the First Offer

In financial services negotiations, making the first offer can be a strategic advantage, especially when backed by solid data and a clear rationale.  Anchoring the conversation with a well-researched initial proposal sets the tone and range for the negotiation, often influencing the counterparty’s expectations and responses.  Professionals should ensure their first offer reflects both ambition and realism—high enough to allow room for concessions, yet grounded enough to be taken seriously. By controlling the starting point, you shape the framework of the discussion and demonstrate confidence, which can be particularly persuasive in high-stakes financial contexts.

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