Masterbeat Corp (MSTO)

[Dr Blunt]

Understanding the Expert Market for those who don't know: The Expert Market is a distinct market tier that allows broker-dealers to trade securities with regulatory and other restrictions. It has grown in response to recent amendments to SEC Rule 15c2-11. Under that rule, when companies fail to publish required current information, brokers may only publish unsolicited quotes, meaning quotes representing limit orders from investors who are not company affiliates or insiders. Following changes to Rule 15c2-11, in September 2021, the Expert Market expanded to include thousands of these “dark” securities. As an additional protection, Expert Market quotes are distributed only to broker-dealers, institutions, and accredited investors.

The Expert Market serves three vital regulatory purposes. First, it provides broker-dealers with an electronic market on which to meet their FINRA-mandated agency and Best Execution responsibilities in these securities. Second, by serving as a more restricted venue for broker-dealers to represent customer limit orders in securities that do not meet the Pink Current or Pink Limited requirements, it gives effect to the SEC’s goal of encouraging public company disclosure. Third, by limiting quote distribution to professionals, such offers are not considered general solicitation under state and federal securities laws.

Read the rest of the article here: The Expert Market: Its Larger Role Post Rule 15c2-11