Individuals and companies desire to start a broker-dealer for many reasons including to facilitate sales, create an entry point for foreign financial institutions, or be a part of a larger financial plan. Some of the benefits to starting a broker-dealer (vs. purchasing an existing one) include saving money on due diligence, having no prior regulatory or financial issues, and the ability to customize it to fit your desired products and business lines. If you are looking for more pros and cons to starting vs. Buying a broker-dealer, read one of our recent posts on the topic “here”. If you decide Read more about Key Steps for Starting a Broker-Dealer[…]
The U4, also known as the Uniform Application for Securities Industry Registration or Transfer, is the primary source of information for a registered representative’s (also known as “broker”, “financial professional”, “financial advisors”) Central Registration Depository (CRD) or Investment Adviser Registration Depository (IARD) record. Both the firm and the registered representative can update Form U4, but it is ultimately the registered representative’s responsibility to make sure Form U4 is accurate and current. The U4 record, contains personally identifiable information about each applicant such as name, SSN, physical characteristics, address history, work experience, and education. In addition, the U4 also requires disclosure Read more about Form U4 Disclosure Reporting Best Practices to Protect You and Your Firm[…]
MasterCompliance continues to provide clients and the public with guidance on industry focus areas, new rules, compliance foundations, and regulatory priorities. This blog explores our top 5 blogs of 2021. 1. Form ADV Part 2B: Disclosures for Supervised Persons Form ADV Part 2B is a brochure supplement that must contain certain information about specific individuals, acting on behalf of the investment adviser, who actually provide the investment advice and interact with the client. The brochure supplement is also a narrative format in plain English and includes six required disclosure categories, with a seventh for advisers registered or are registering with Read more about Our Top 5 Blogs of 2021[…]
This is a reminder that December 13, 2021, is the payment deadline for Broker-Dealer, Investment Adviser Firm, Agent and Investment Adviser Representative, and Branch Renewals for 2022. Firms that miss this deadline can still make payments until 6 p.m. ET on Dec. 26, 2021, but they will be subject to a late fee. If payment is not received by Dec. 26, 2021, firms risk becoming ineligible to do business in jurisdictions where their registrations are not renewed. FINRA’s Renewal Program supports the collection and disbursement of fees related to the renewal of broker-dealer (BD) and investment adviser (IA) registrations, exempt Read more about Upcoming Payment Deadlines for 2022 Renewals[…]
This blog serves as a reminder of important dates related to FINRA’s 2022 Annual Registration Renewal Program. If you have any state registrations that you do not want to renew in 2022, you must take action by Friday, November 5th in order to avoid being charged on the Preliminary Statement. Registration terminations can be post-dated to remain active through the end of 2021. The Preliminary Statement will be available in FINRA E-bill on Monday, November 8th. After this time, you will still be able to drop registrations. However, once it is generated, the Preliminary Statement must be paid in full Read more about FINRA Annual Registration Renewal Calendar[…]
Agents are individuals in a sales capacity who represent broker-dealers or issuers of securities. As agents, they act, usually on commission basis, on behalf of others. Agents are often referred to as registered representatives, whether sell registered securities or securities exempt from registration. The use of the term individual here is important. Only an individual, or a natural person, can be an agent. A corporation such as a brokerage firm is not a natural person, it is a legal entity. The brokerage firm is the legal person, or legal entity, the agent, a natural person, represents in securities transactions. Also, there are exclusions from registration as an agent, which are listed below.