DEFINITION of 'Rules Of Fair Practice'
A set of rules and regulations developed by the National Association Of Securitie Dealers (NASD) or what is now called the Financial Industry Regulatory Authority (FINRA). The rules are a standard which members of FINRA must follow regarding their duties to customers.
BREAKING DOWN 'Rules Of Fair Practice'
Since FINRA is a self-regulatory organization the rules it enforces must be followed in addition to any commercial securities laws that have been passed. In a broad view, the Rules of Fair Practice cover the fair dealing, duty of loyalty, obligation of disclosure and other duties stockbrokers provide to their customers.