Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing of a Proposed Rule Change To Adopt FINRA Rule 4321 (Allocations of Fail To Deliver Positions) and Amend FINRA Rule 4560 (Short-Interest Reporting)

ers to use arranged financing is to obtain increased leverage rather than to avoid short interest reporting, which, to the extent this is true, would limit incentives to shift lending to non-FINRA members, including banks. FINRA further understands that, although it is possible for customers to obtain short exposure to a security through other means, it would be impractical for entities other than affiliates of FINRA members to offer a service substantially similar to arranged financing. FINRA continues to believe that requiring members to include these positions will improve the completeness of reported short interest information, and notes that this information is not reasonably ascertainable elsewhere; therefore, requiring members to report this information is reasonable and appropriate. 2. Frequency and Timing of Short Interest Position Reporting and Dissemination In the Notice, FINRA requested comment on potentially increasing the frequency of short interest reporting and dissemination. Specifically, FINRA stated that it was considering increasing the frequency of short interest reporting and dissemination from bi-monthly to weekly or daily. In addition, FINRA noted that it was considering shortening the timeframe for members to submit short interest reports and reducing the amount of time FINRA takes to process the collected information so that FINRA could disseminate sho