August 25, 2015

Start a New Broker/Dealer

We have been assisting firms with starting new broker/dealers and the related registration process with the FINRA, SEC, and MSRB since 2003. Some of the types of broker/dealers that we have assisted in starting new firms include:

  • Investment Banking firms
  • Private Placement firms
  • Retail firms with clearing relationships
  • Merger & Acquisition firms

 
Upon application submission, FINRA has 30-days to respond to the broker/dealer application with questions and/or requests for clarification or additional information. Once a request from FINRA is issued, the applicant then has 60-days to respond. In order to keep the process moving, we strive to provide response turn-around as quickly as possible. FINRA then has another 30-days to respond with further questions or requests, if needed. Once this second request is issued, the applicant has another 30-days to respond. It is common at this point in the application process to schedule a membership interview; however, there may be circumstances that warrant a third request letter, which again follows the 30-day FINRA and applicant response windows.

Once a membership interview has been conducted, FINRA will typically approve the broker/dealer within 30-days from the meeting date if no further information is requested. Based on our experience, the entire NMA process can take from four to six months. It is important to note that FINRA is obligated to issue a final decision on the application no later than six months following the application submission unless extraordinary circumstances require an application extension.

Some of the details and work required to start a new broker/dealer include:

  • Initial New Client Consultation
  • Determination of Desired Business Lines
  • Assignment of Principal Registrations and Executive Positions
  • Name Reservation
  • CRD and Form NMA Entitlement Process
  • Preparation and Submission of the Form BD
  • Documentation of Corporate Structure
  • Capital Funding and establishment of accounting systems
  • Completion of Form NMA Process
  • Construction of an Application Business Plan
  • Application for FINS#
  • Completion and Submission of Form U4s
  • Construction and submission of Written Supervisory Procedures to satisfy FINRA membership checklist
  • State registration assessment and applications
  • Help determine which additional licenses, if any, your representatives will need
  • Application for Fidelity bond
  • Establishment and submission of an Anti-Money Laundering Compliance Program
  • Establishment and submission of a Customer Identification Program
  • Construction and submission of a Business Continuity Plan
  • Registration with Lost and Stolen Securities Program
  • Gathering of information and additional documents requested in follow-up requests from FINRA once the initial application is submitted
  • Preparation for FINRA membership interview

 
To learn more about our services, contact us or call 1-404-841-1010.