Final answer:
FINRA can take disciplinary action against a registered rep if a rules violation is believed to have been committed.
Step-by-step explanation:
When FINRA believes that a registered representative has committed a rules violation, they will conduct an investigation to gather evidence and information.
If the evidence supports the violation, FINRA can take disciplinary action against the registered rep. The disciplinary action can range from fines and suspensions to permanent bans from the industry.
For example, if a registered rep is found to have engaged in unauthorized trading, FINRA may impose monetary fines and suspend their license for a specific duration as a penalty.
The severity of the violation and the rep's history of misconduct will impact the disciplinary action taken.