The Financial Industry Regulatory Authority’s second attempt at a recruitment-bonus disclosure rule hasn’t won many fans. 

Securities firms say the plan to require disclosure of brokers’ recruitment incentives is fraught with operational hurdles and could open brokers to litigation.

On the other side, state regulators and plaintiffs’ attorneys say the latest proposal doesn’t go far enough in disclosing conflicts brokers may have with hiring incentives.

Finra’s proposal is a slimmed-down version of a controversial earlier plan that was scrapped last summer. That original plan would have required detailed dollar disclosures of recruitment incentives.

The rehashed plan would simply require delivery of a Finra-written communication to clients that would encourage them to ask about the financial incentives their brokers received for making a move. The communication would have to be delivered within three days of when a client was first contacted about moving his or her account.

Finra asked for comment on its revamped proposal in May. Comments were due July 13.

In comment letters, financial services firms applauded Finra for scaling back the detailed disclosures from the first proposal, but they say the new plan will be too difficult to supervise.

For one thing, starting the clock on the three-day delivery requirement would be impossible, industry commenters say.

The Securities Industry and Financial Markets Association (SIFMA) and the Financial Services Institute, among other groups, suggested that the communication be delivered along with account-transfer documents.

But state regulators want delivery to be done “in advance of any attempt to contact the customer regarding the transfer of an account,” said a comment letter from the North American Securities Administrators Association.