Escalating Complaints and/or Potential Red Flags
When a customer complaint is received by a broker-dealer, the appropriate personnel at the member firm must promptly be notified. This is also the ca…
Showing posts from February, 2019Show all
Political Contributions
Political Contributions Municipal securities are issued by states, cities, counties, school districts, etc. Therefore, many elected officials are in …
Gifts and Gratuities & Non-cash Compensation
FINRA does not allow member firms and their associated persons to buy influence at other firms with gifts of cash or gifts with resale value over a c…
Specific Communications Rules
Investment Company Products New FINRA members must pre-file their retail communications at least 10 business days before first use with the Advertisi…
Research Reports
If you're a big Wall Street broker-dealer the research reports your analysts put out encouraging customers to buy or sell a security can have …
Communications with the Public
Communications with the Public Before we distinguish the types of communications, let's understand the main points: A principal (compliance offi…
Code of Arbitration
Code of Arbitration When broker-dealers are arguing over money, they must take it to arbitration. Under the Code of Arbitration members of FINRA must…
Code of Procedure (COP)
Code of Procedure (COP) FINRA investigates violations of the conduct rules through Code of Procedure. When we mentioned words such as "suspend, …
Gifts and Gratuities
Gifts and Gratuities FINRA does not allow member firms and their associated persons to buy influence at other firms with gifts of cash or gifts with …
Supervision
FINRA requires principals to supervise registered representatives. The member firm must establish and maintain written procedures to supervise the ty…
More on Registration & Exemptions
More on Registration Requirements Many people in the industry ask, "If I stop selling for a while, can I just park my license at the firm unti…
Principals
Principals Member firms need principals who review correspondence, approve every account, initial order tickets, handle written customer complaints, …
FINRA Membership
FINRA Membership If your firm wants to join FINRA, it must: • meet net capital requirements • have at least two principals to supervise the fir…
FINRA
FINRA The Securities and Exchange Commission has authority over broad aspects of the securities industry. They are granted this authority under the S…
Investment Advisers Act of 1940
Investment Advisers Act of 1940 If you want to give people your expert securities advice based on their specific investment situation and receive com…
Investment Company Act of 1940
Investment Company Act of 1940 The SEC summarizes this federal securities law like so: This Act regulates the organization of companies, including mu…
Trust Indenture Act of 1939
Trust Indenture Act of 1939 The SEC describes the Trust Indenture Act of 1939 like so: This Act applies to debt securities such as bonds, debentures,…
Securities Exchange Act of 1934
Securities Exchange Act of 1934 As mentioned, the Securities Exchange Act of 1934 is broader in scope than the Securities Act of 1933. As the SEC exp…
Securities Act of 1933
Securities Act of 1933 The Securities Act of 1933 aims to ensure that investors have all the material infor¬mation they need before buying stocks and…
Prohibited Activities Related to Trading
Broker-dealers and their agents are not allowed to take advantage of customers through churning, excessive mark-ups, breakpoint sales, front-running,…
