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The question of who is required to have an active FINRA Series 24 (General Securities Principal) registration is often not as easy to answer as you may think. As a broker-dealer compliance consulting specialist, we encounter this question from seasoned FINRA compliance veterans and new broker-dealers alike. The licensing requirements for supervisors are often thought of as being reasonably simple. If you supervise a specific line of business or supervise other reps conducting that business, you must be registered as a principal of the firm. However, what if you are going through the New Member Application (“NMA”) process to start Read More....
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FINRA Rule 1250(b) discusses FINRA’s Firm Element continuing education requirements. Firm Element continuing education requirements apply to “covered persons”, which is defined as registered persons – including salespeople, traders, sales assistants, investment company shareholder servicing agents, investment bankers, and others who have direct contact with public customers in the conduct of a securities sales, trading, or investment banking business – and their immediate supervisors. The term “customer” in the definition of covered persons includes retail, institutional, and investment banking customers, but does not apply to other broker-dealers. Member firms are required to analyze and evaluate their training needs in light Read More....
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[Continued from Exempt Reporting Adviser Registration – Part I] Requirements for Exempt Reporting Advisers: Exempt Reporting Advisers (“ERAs“) must submit to the SEC, and periodically update, a truncated version of the Form ADV. More specifically, ERAs must complete the following items of Part 1A of Form ADV: Item 1. – Identifying Information (g., ownership, description of advisory business, and fees charged); Item 2. B and C – SEC and State Reporting by Exempt Reporting Advisers; Item 3. – Form of Organization; Item 6. – Other Business Activities; Item 7. – Financial Industry Affiliations and Private Fund Reporting; Item 10. – Read More....
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The Dodd-Frank Act (“Dodd-Frank”) not only mandated the registration of countless investment advisers, but also introduced a new classification of advisory firm – the Exempt Reporting Adviser – that is exempt from registration under the Investment Advisers Act of 1940 (the “Advisers Act”). Exempt Reporting Advisers (“ERAs“) are investment advisers that are not required to register as an adviser with the SEC or state regulators, due to their status as an advisor to either: (i) private funds and having less than $150 million of assets under management; or (ii) qualifying venture capital funds. Types of Exemptions: Private Fund Adviser: Dodd-Frank exempts from Read More....
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The Securities and Exchange Commission (SEC) recently announced revisions to the ADV Part 1. These changes will affect most Registered Investment Advisers (RIAs) when they complete their annual amendment; however, RIAs may be prompted to address additional questions if a firm submits an amendment on or after October 1st. The revisions made by the SEC only affect Part 1 of Form ADV. Most of the revisions were made to provide regulators with more information that they find pertinent. In some cases, clarifications were made to cover areas where there were frequent questions. Below is a summary of some of the Read More....
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Note: With the implementation of the Test Enrollment Services System (TESS), FINRA has stopped using Form U10. We are leaving this post up as to not disturb any saved links; however, please visit our more recent post, (Form U10 and TESS (Test Enrollment Services System), for current information on the topic. If you’re seeking FINRA registration, you must be employed by or associated with a FINRA member firm. If you are required to take a FINRA examination while associated with a FINRA member firm – or a firm applying for FINRA membership – all examination scheduling should happen via Form Read More....
