What is a 15a-6 exemption?
Background. Rule 15a-6 under the Securities Exchange Act of 1934 provides conditional exemptions from broker-dealer registration for foreign broker-dealers1 that engage in certain specified activities involving U.S. investors.
What is the 15a-6 rule?
As previously discussed, Rule 15a-6 permits a foreign broker-dealer to contact major US institutional investors without the participation of an associated person of a registered broker-dealer in any such contacts.
What is a foreign associated person?
A. Under NASD Rule 1100 , a Foreign Associate is an individual who is not a citizen, national, or resident of the United States or any of its territories or possessions. A Foreign Associate cannot engage in securities activities with or for any resident, citizen, or national of the United States.
What is a chaperoning arrangement?
A chaperoning arrangement requires a U.S. registered broker-dealer to take responsibility for conducting and monitoring certain activities in connection with a Foreign BD’s U.S. investor contacts and transactions.
Who is not required to be fingerprinted at a broker-dealer?
Rule 17f-2 exempts employees from fingerprinting who do not: Sell securities; Regularly have access to the keeping, handling, or processing of securities, monies, or the original books and records relating to the securities or monies; and.
What is effecting a transaction?
(March 2000) states: “A person is effecting a securities transaction if he or she participates in such transactions at ‘key points in the chain of distribution.
Who is not considered an associated person?
In futures trading, the term “associated person” refers to particular people within the employ of a broker or dealer that perform the role of sales or supervision of sales. Clerical and administrative employees are not included.
Who is considered an associated person?
The term “Associated Person” means: (1) a natural person registered under FINRA rules; or (2) a sole proprietor, or any partner, officer, director, branch manager of the Applicant, or any person occupying a similar status or performing similar functions; (3) any company, government or political subdivision or agency or …
Who needs fingerprinting for FINRA?
Q1: Which firm personnel are required to be fingerprinted? A1: Pursuant to Section 17(f)(2) of the Securities Exchange Act of 1934 and Rule 17f-2 thereunder, as amended, the SEC requires firms to submit fingerprints for all partners, directors, officers and employees, unless they are exempt under those same provisions.
Who is not required to be fingerprinted at a broker-dealer cage clerk?
Specifically, for broker-dealers, one need not be fingerprinted if one is: a) not engaged in the sale of securities, b) doesn’t have regular access to the keeping, handling or processing of securities, monies, or original books and records relating to securities or monies of the broker-dealer, and c) does not have …
Do finders need to register with SEC?
The Securities and Exchange Commission (SEC) currently requires finders who receive fees based on the size or successful completion of securities transactions to register as broker-dealers.
What is transaction based compensation?
Though there is some variation in the case law, at least as far as the SEC staff is concerned, receipt of commissions or other compensation that is based on the size or completion of securities transactions, which is often referred to as “transaction-based compensation,” creates a strong presumption that registration …
Who can be an associated person?
Who needs to be registered as an associated person?
An associated person (AP) is an individual who solicits orders, customers or customer funds (or who supervises persons so engaged) on behalf of a futures commission merchant (FCM), retail foreign exchange dealer (RFED), introducing broker (IB), commodity trading advisor (CTA) or commodity pool operator (CPO).
Who is not an associated person?
Is your agent an associated or control person?
Associated Person is any individual under the control of a broker dealer, issuer or bank including employees, officers, and directors, as well as those individuals who control or have common control of a broker dealer, issuer or bank.
How far back does a FINRA background check go?
States with the seven-year limit: California. Maryland. Massachusetts.
What kind of background check does FINRA do?
FINRA’s Form U4 is used to register individuals with FINRA member firms. Form U4 requires applicants to make specific disclosures about their criminal history, regulatory action history, civil judicial and litigation history, and personal financial history (including bankruptcies).
Does FINRA do background check?
FINRA requires most employees at the broker-dealer firms it regulates to be fingerprinted and screened for past criminal history, regardless of whether the employee is to be registered with FINRA to be involved in investment decisions.
Do investors pay a finders fee?
Sometimes they’re gifts, other times it’s a commission or percentage. Usually, real estate agents pay finders’ fees, not investors directly.
Is finder’s fee legal?
A finder’s fee isn’t legally binding, so it is often simply a gift from one party to another. This is commonly seen in real estate deals. If someone is selling their home and their friend connects them with a potential buyer, the seller might give their friend a small portion of the sale when the deal is finalized.
Can a startup pay a transaction based fee or commission to someone who helps raise capital?
The short answer is that—except under certain limited circumstances—it is likely illegal, it may provide investors with a right to their money back with interest and attorney fees, and it may result in, among other things, founders being held personally liable to investors.
Which of the following is considered to be an associated person of a business?
A sole proprietor, partner, officer, director, branch manager of the member firm, or any person occupying a similar status of performing a similar function.
What will disqualify you from FINRA?
causing repeated and routine scheduling problems; being unprepared for conferences and hearings; being unwilling to abide by the Code; and. violating the Code of Ethics for Arbitrators in Commercial Disputes.
What shows up on a FINRA background check?
Existing FINRA Requirements
Form U4 requires applicants to make specific disclosures about their criminal history, regulatory action history, civil judicial and litigation history, and personal financial history (including bankruptcies). The Form U4 is filed with the Central Registration Depository (CRD).