FINRA rules require member firms to “establish and maintain a system of supervisory procedures (WSPs) to supervise the activities of its associated persons and the types of businesses in which it engages in.” This in short, creates a duty for a member firm and its designated supervisors to properly supervise all the activities associated with the handling of customer accounts. This necessarily includes the interaction of the broker with the client and the proper handling of the customer account.

Failure to adhere to the supervisory rules can give rise to a cause of action if a customer sustains losses from such failure to supervise.