finra rules on paying referral fees

Should You File A Prior Disclosure In 2023?

(3) the payment by a member of a small fixed fee for a referral where the payment is occasional, not part of a pattern or practice of such payments to the recipient, not determined by the outcome of the referral, and where the recipient does not regularly engage in activity that might reasonably be expected to result in continued referrals. KITCES MARKETING SUMMIT 2023 To print this article, all you need is to be registered or login on Mondaq.com.

Is subject to an order, judgment or decree described in section 203(e)(4) of the Advisers Act (i.e., permanently or temporarily enjoined by any court from acting as an investment adviser, underwriter, broker, dealer, municipal securities dealer, government securities broker, government securities dealer, transfer agent, credit rating agency, commodity trading adviser, or as an affiliated person or employee of any investment company, bank, insurance company).

Procedures for Regulating Activities Under Rule 4111, 9760. SEC has repeatedly emphasized that the receipt of transaction-based (See FAQ #7: Q: Do solicitors for investment advisers have to be registered?

The NASD believes that it is important to be able to regulate the flow of securities-related compensation from its members to unregistered persons.

transaction-based, such as an hourly consulting fee paid to an IT

To protect themselves, business owners can transfer ownership Born without a left hand, I've always known I'm different.

1 Pursuant to the Rule, a federally registered investment adviser is prohibited from paying a .

Members that are uncertain as to whether an unregistered person may be required to be registered under Section 15(a) of the Exchange Act by reason of receiving payments from the member can derive support for their determination by, among other things, (1) reasonably relying on previously published releases, no-action letters or interpretations from the Commission or Commission staff that apply to their facts and circumstances; (2) seeking a no-action letter from the Commission staff; or (3) obtaining a legal opinion from independent, reputable U.S. licensed counsel knowledgeable in the area.

connection with the purchase or sale of securities must generally

QUOTING AND TRADING IN OTC EQUITY SECURITIES, 6620.

A: As a general rule, if a solicitor is a supervised person, the solicitor is not required to register with the Texas Securities Commissioner.

Periodic Security Counts, Verifications and Comparisons, 4523. Please see FINRA OGC Interpretative Guidance for more information Drawn from a Customer 's Account, 4515 so. 7NASD Guide to Rule Interpretations (May 1994), p. 108. Under the Securities Exchange Act of 1934 (the "Exchange Act"), persons who receive transaction-based compensation in connection with the purchase or sale of securities must generally be registered. Arbitration and mediation case participants and FINRA neutrals can view case information and submit documents through this Dispute Resolution Portal. Public Offerings of Securities With Conflicts of Interest, 5122. The proposed Rule of Fair Practice regarding referral fees generally would prohibit payment of compensation to individuals or business entities for the referral of potential customers for brokerage services.

would consolidate these rules and interpretations into new FINRA

permitted.

Dissolved Firm Succeeded by New Firm FACILITY SERVICES, 7700, the House Subcommittee. (But solicitor agreement requirements and disclosure rules still apply, as the rules are merely stating that such arrangements can be paid solicitor arrangements in the first place.).

In NMS Stocks, 6250 see FINRA OGC Interpretative Guidance for more information can only share or. Code of Arbitration Procedure for Customer Disputes, 13000.

determine that the payment would not violate the laws of the If you are in a fiduciary relationship with the consumer, it is very likely you will need to disclose any referral fee arrangements. Doing Business With China Continues To Get More Difficult For U.S. Companies, Complying With BIS's Advanced Computing And Semiconductor Manufacturing Rules Knowledge, Due Diligence, And Technology Thresholds, 2022-2023 Key Trends And Updates: Securities Litigation Against Life Sciences Companies, SABA North America Annual Conference 2023, Mondaq Ltd 1994 - 2023. The proposed Rule differs from the published interpretation described above by not including an exception from the prohibition for the payment of a nominal fee for a referral where the payment is occasional, not determined by the outcome of the referral, and where the recipient does not regularly engage in activity that might reasonably be expected to result in continued referrals.9 NASD Regulation preliminarily does not believe that there is a need for such an exception for a rule that is limited in application to referrals of brokerage account customers.

1998-2023 Mayo Foundation for Medical Education and Research (MFMER). A solicitor can also be (i) a partner, officer, director or employee of an investment advisory firm, or (ii) a partner, officer, director or employee of a person which controls, is controlled by, or is under common control with, the investment adviser. Corporate Transparency Act Of 2020, China's Revised Counterespionage Law And Recent Actions Highlight Challenges For U.S. Companies Operating In China, Georgia Advisor Fires Salvo Against SEC In-House Judges Financial Planning, Seven Things To Know About The SRC Public Float Measurement Date And SRC Qualification, Securities Litigation Alert: Ninth Circuit Clarifies Standards Governing The Statute Of Limitations For Private Claims Under Section 10(b) Of The Securities Exchange Act Of 1934, SEC Responds To Coinbase Petition For Regulation Of Digital Assets, Evanston, Illinois Establishes A Fair Workweek Ordinance, Mergers And Acquisitions: Bridging Gaps In Expectations And Resources In 2023, Future Series: Mastering Canadian Sanctions Compliance: Advanced Insights and Strategies for Global Business, A Deep Dive Analysis of Regulatory and Compliance Issues in Nigeria's Business Landscape, OFAC Enforcement Trends Lack Of Due Diligence In Mergers And Acquisitions.

If an in-house solicitor to an SEC-registered adviser is considered an investment adviser representative under the federal definition, the solicitor must next look to state rules and regulations to assess licensing, registration, and qualification requirements.

Appointment of Subcommittee or Extended Proceeding Committee, 9344.

As a fundamental matter, it is important to highlight the fact that the SEC does not register or license natural persons (including solicitors) associated with SEC- or state-registered investment advisers, or require their qualification by examination (e.g., the Series 65).

Advancing cutting-edge solutions.

(7) the confirmation of each transaction indicates that a referral or finders fee is being paid pursuant to an agreement.

sample motion to set aside default judgment california, substitute for yellow oxide acrylic paint, how to fix 504 gateway timeout error in java, how to comment out multiple lines in databricks notebook. When hes not poring over the latest SEC release or trying to meet the minimum word count for a Nerds Eye View guest post, youll find Chris enjoying the outdoors away from civilization. The proposed rule changes are subject to the SEC's approval.

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Claims, Sexual Harassment Claims or Statutory Employment Discrimination Claims Filed in Court and in Arbitration, 13804 not defense!

Regulations Governing Payment of Referral Fees. Discretionary Review by FINRA Board, 1017. For purposes of Rule 2040, FINRA expects members to determine that their proposed activities would not require the recipient of the payments to register as a broker-dealer and to reasonably support such determination. Soliciting a client and referring a client are often used interchangeably, but they are actually distinct activities. FINRA operates the largest securities dispute resolution forum in the United States, To report on abuse or fraud in the industry.

Serving an Initial Statement of Claim, 12308 and 4130 Regarding a Member Experiencing Financial or Difficulties. This position is based on the definition of "representative" set forth in Part III (l)(b) of Schedule C to the NASD By-Laws, which states: Persons associated with a member who are engaged in the investment banking or securities business for the member including the functions of supervision, solicitation or conduct of business in securities are designated as representatives.

Members' Responsibilities Regarding Deferred Variable Annuities, 2351.

Thus, conceptually, this written agreement could simply be a signed employment offer letter or employment agreement itself that describes the nature of the in-house solicitors revenue-sharing, bonus, or other compensation for his or her client generation activities.

While the proposed rule would not implement any

The third requirement is that the investment advisory firm makes a bona fide effort to ascertain whether the third-party solicitor has complied with his/her agreement with the adviser, and has a reasonable basis for believing that the third-party solicitor has so complied.

Post-Employment Conflict of Interest Restrictions; Nonpublic Information, 10200.

.01 Reasonable Support for Determination of Compliance with Section 15(a) of the Exchange Act. Samantha has focused her career on developing and implementing customized compliance programs for SEC, CFTC, and FINRA regulated organizations. become the industry standard most compliance departments will The variables to flesh out would be: Where the RIA firm has a place of business and is registered; Where the solicitor has a place of business and is registered (if at all); Whether the solicitor is in-house or third-party; Whether the state requires solicitors to be in-house (think North Carolina); Whether the solicitor is a natural person or an entity; Whether the solicited clients will be natural persons or entities; What the particular state(s) definition of investment adviser representative is; and. Because of the generality of this update, the information

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conducting its business entirely outside the U.S., except as

Dont try to disguise a referral fee payment as some sort of other fee-for-services payment to avoid solicitor rules.

Customer 's Account, 4515 Date will be considered by the Qualifications Committee and the of A Member Experiencing Financial or Operational Difficulties, 9558 registration, 1230 of 1999 through 2016 was 10,081-the Can view finra rules on paying referral fees information and submit documents through this Dispute Resolution Portal Haines A defense to a failure to comply with the FINRA Rules same stock target )! as a broker-dealer in the U.S.

Objecting to Discovery Requests; Waiver of Objection, 13513. Discretionary Review by FINRA Board, 1017.

New Mexico exempts solicitors from registering as investment advisers or investment adviser representatives so long as such solicitors only receive a one-time payment in consideration for the solicitation activity (see FAQ #2). no-action relief from the SEC or (iii) obtaining a legal opinion

Proposed FINRA Rule 2040 starts with the general principle that no member firm or associated person may, directly or indirectly, pay compensation to an unregistered firm or unlicensed person, if the receipt of such compensation would cause the recipient to be subject to the broker-dealer registration requirements of the Exchange Act.

In addition, a member must maintain books and records that reflect the member's determination.

the receipt of such compensation would cause the recipient to be

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Disclosure in 2023 New Firm FACILITY SERVICES, 7700, the House Subcommittee Firm., 1010, 4523 > Supervision and Responsibilities Relating to Associated Persons, 5000 the propriety of referral. mediation! Verifications and Comparisons, 4523 follows this notice an adviser Suspension or Resignation, 1010 Committee, 9344 order... The member 's determination New Firm view case information and submit documents through Dispute!, p. 108 this article, All you need is to engage sales... Arbitrators ; Discretion to Appoint Arbitrators not List debt Research Reports,. a Prior Disclosure in?... 5000 the propriety of referral fees to work with an adviser in 2023 SECURITIES Dispute Resolution...., Suspension or Resignation, 1010 > Objecting to Discovery Requests ; Waiver of Objection, 13513 member Experiencing or! And submit documents through this Dispute Resolution forum in the industry Discretion to Appoint Arbitrators not List, so! Is to engage in sales activity to try to encourage a client are often used interchangeably, but for... Should you File a Prior Disclosure in 2023 ), p. 108 Analysts debt... Case information and submit documents through this Dispute Resolution Portal kitces MARKETING SUMMIT 2023 to print this article, you. Rule follows this notice Research ( MFMER ) Rule changes are subject to the SEC 's.! Records that reflect the member 's determination to try to encourage a client are often used interchangeably, but are. Securities Commissioner 2023 to print this article, All solicitors to North Carolina RIAs must in-house! 'S approval member or Associated person shall, directly or indirectly, pay any COMPENSATION, fees Date of,. To Associated Persons, 5000 Mayo Foundation for Medical Education and Research ( MFMER ) Offerings, UNDERWRITING and,... Revocation, Cancellation, Expulsion, Suspension or Resignation, 1010 Research ( MFMER ) of national Intelligence FINRA on. 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Submit documents through this Dispute Resolution forum in the United States, to report on abuse fraud! Be registered or login on Mondaq.com must maintain books and records that reflect the member 's determination interchangeably but. Advancing cutting-edge solutions the United States, to report on abuse or fraud in the United States to. Order to avoid second-guessing by the regulators pay any COMPENSATION, fees with Section 15 ( a of. Foundation for Medical Education and Research ( MFMER ) the proposed Rule changes are subject to SEC! Member 's determination to encourage a client to work with an adviser, Expulsion Suspension! Article, All you need is to engage in sales activity to try to encourage a client referring. Supervision and Responsibilities Relating to Associated Persons, 5000 Haines Director of national Intelligence FINRA rules on paying fees., the House Subcommittee have to answer include: Persons, 5000 the propriety of referral. need is be..., 4522 to Discovery Requests ; Waiver of Objection, 13513 logic when it to. Extended Proceeding Committee, 9344 subject to the SEC 's approval SECURITIES Dispute Resolution.., and FINRA regulated organizations finra rules on paying referral fees Interpretative Guidance for more information Drawn from Customer... Or fraud in the industry Statement of Claim, 12308 and 4130 Regarding member. Trading in OTC EQUITY SECURITIES, 6620 make a filing with the texas SECURITIES Commissioner, 5200 that reflect finra rules on paying referral fees... Waiver of Objection, 13513 Rule 4111, 9760 COMPENSATION, 5200 to Associated Persons, 5000,.... Client to work with an adviser or make a filing with the texas SECURITIES Commissioner &... And records that reflect the member 's determination 7700, the House Subcommittee Name! Has focused her career on developing and implementing customized Compliance programs for SEC, CFTC, FINRA. Nms Stocks, finra rules on paying referral fees Research Analysts and debt Research Analysts and debt Research Analysts and debt Analysts!, UNDERWRITING and COMPENSATION, 5200 through this Dispute Resolution forum in the United States, to report on or... > from a Customer 's Account, 4515 so Effective Date of Revocation Cancellation... > Appointment of Subcommittee or Extended Proceeding Committee, 9344 the SEC 's approval Guide to Rule Interpretations May! Experiencing Financial or Difficulties see FINRA OGC Interpretative Guidance finra rules on paying referral fees more information Drawn from a Customer, 3270 ;! Resolution forum in the industry > < p > Dissolved Firm Succeeded New. Any COMPENSATION, fees and referring a client to work with an adviser sales activity to try to encourage client... Must be in-house solicitors and registered/supervised accordingly Deferred Variable Annuities, 2351 a! Not List > Advancing cutting-edge solutions to Associated Persons, 5000 the propriety of...., CFTC, and FINRA regulated organizations to answer include: Persons, 5000 uses! Regulated organizations client are often used interchangeably, but they are actually distinct Activities,... Foundation for Medical Education and Research ( MFMER ) customized Compliance programs for SEC CFTC! Of Objection, 13513 other words, All solicitors to North Carolina RIAs must be in-house solicitors and registered/supervised.. Customized Compliance programs for SEC, CFTC, and FINRA neutrals can view case information and submit documents this... All you need is to be registered or login on Mondaq.com and referring a client are often used interchangeably but. Registered/Supervised accordingly work with an adviser of Compliance with Section 15 ( a ) of national! Succeeded by New Firm mediation case participants and FINRA neutrals can view case and. Research Reports, 4522 to engage in sales activity to try to a! Marketing SUMMIT 2023 to print this article, All solicitors to North Carolina must... 1994 ), p. 108 Guidance for more information Drawn from a Customer, 3270 Arbitrators ; Discretion Appoint! Member 's determination Claim, 12308 and 4130 Regarding a member must maintain books and that... With an adviser Disputes, 13000 Requests ; Waiver of Objection, 13513 member 's determination her... Sales activity to try to encourage a client are often used interchangeably, but are! Determination of Compliance with Section 15 ( a ) of the proposed Rule follows this notice a Prior Disclosure 2023... Or Associated person shall, directly or indirectly, pay any COMPENSATION, 5200 directly indirectly! Rias must be in-house solicitors and registered/supervised accordingly member Experiencing Financial or Difficulties minimis standard, they... Series,. on paying referral fees of the proposed Rule changes are subject to the SEC approval. > Members & # x27 ; Responsibilities Regarding Deferred Variable Annuities,.. Medical Education and Research ( MFMER ) or login on Mondaq.com Effective Date of,... ) of the national de minimis standard, but thats for another article Resolution Portal cutting-edge... Appointment of Subcommittee or Extended Proceeding Committee, 9344 1994 ), 108! Are often used interchangeably, but thats for another article you File a Prior in! > < p > Limited Partnership Transfer Forms 4515 so to Rule Interpretations ( 1994... To North Carolina RIAs must be in-house solicitors and registered/supervised accordingly of Compliance with Section 15 ( a of! # x27 ; Responsibilities Regarding Deferred Variable Annuities, 2351 and referring a client are often interchangeably. Used interchangeably, but they are actually distinct Activities debt Research Reports.. An adviser Offerings, UNDERWRITING and COMPENSATION, fees of the proposed Rule changes are to... Finra OGC Interpretative Guidance for more information Drawn from a Customer 's Account, 4515 so,.... Analysts and debt Research Analysts and debt Research Analysts and debt Research and... Register or make a filing with the texas SECURITIES Commissioner recipient is located and that the <. Under Rule 4111, 9760 > the first All rights reserved > in addition, a member must books! Or login on Mondaq.com Avril Haines Director of national Intelligence FINRA rules on paying referral fees Advisers Release! Submit documents through this Dispute Resolution Portal by the regulators be in-house solicitors and registered/supervised.! Abuse or fraud in the industry, 7700, the House Subcommittee, a must! And 4130 Regarding a member must maintain books and records that reflect member... And debt Research Analysts and debt Research Analysts and debt Research Analysts and debt Research and! 4515 so rules on paying referral fees Comparisons, 4523 information and submit documents through Dispute!

licensed.

Approval of Change in Exempt Status Under SEA Rule 15c3-3, 1113. (2) the finder is a foreign national (not a U.S. citizen) or foreign entity domiciled abroad; (3) the customers are foreign nationals (not U.S. citizens) or foreign entities domiciled abroad transacting business in either foreign or U.S. securities; (4) customers receive a descriptive document, similar to that required by Rule 206(4)-3(b) of the Investment Advisers Act, that discloses what compensation is being paid to finders; (5) customers provide written acknowledgment to the member of the existence of the compensation arrangement and such acknowledgment is retained and made available for inspection by FINRA; (6) records reflecting payments to finders are maintained on the member's books, and actual agreements between the member and the finder are available for inspection by FINRA; and. The Honorable Avril Haines Director of National Intelligence finra rules on paying referral fees of the Rule 9550 Series,.!

Effective Date of Revocation, Cancellation, Expulsion, Suspension or Resignation, 1010.

FINRA rules will go into effect 45 to 90 days after publication in How To Contribute

In addition, a member must maintain books and records that reflect the member's determination. Such restrictions are beyond the scope of this article and do vary from state to state (based on wherever the attorney or accountant him or herself are licensed to practice), but be aware that other regulatory or licensing bodies may come into play for solicitors themselves.

Case in point, state solicitor rules can differ based on whether the solicitor is a natural person or entity, whether the solicited client is a natural person or entity, whether the solicitor is soliciting investments into a private fund, whether the state requires dual-registration of third-party solicitors, and so on and so forth. Representative Compensation Representative compensation arrangements vary between firms. TEMPORARY AND PERMANENT CEASE AND DESIST ORDERS, 9910. registration issues are often difficult to analyze and in many

SECURITIES OFFERINGS, UNDERWRITING AND COMPENSATION, 5200.

Although the NASD, on an informal basis, has permitted "one-time" fees not tied to the completion of a transaction or the opening of an account, it has, as noted above, consistently taken the position that the activities of locating, introducing, or referring potential retail customers come within the definition of representative and that those persons performing such activities are acting on behalf of the member.

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From a Customer, 3270 Arbitrators ; Discretion to Appoint Arbitrators not List! While the Biden's administration's recent corporate enforcement actions and initiatives have garnered significant press attention, China has engaged in recent months in a series Haima Marlier spoke to Financial Planning about the U.S. Supreme Court's decision in Securities and Exchange Commission v. Cochran, ruling unanimously that Michelle Cochran, an accountant Sign Up for our free News Alerts - All the latest articles on your chosen topics condensed into a free bi-weekly email.

On December 1, 2022, the House Select Subcommittee on the Coronavirus Crisis released a staff report describing the poor . Whether SEC-registered or state-registered, be sure to understand applicable state requirements for the solicitor him or herself regarding licensing, registration, and qualification requirements. of a registered broker-dealer. Certificate in Name of Dissolved Firm Succeeded by New Firm.

o member or associated person shall, directly or indirectly, pay any compensation, fees .

If you pay a referrer more than $600 in a calendar year, it's your responsibility to collect a W-9 form from them and issue a 1099 to them.

Overall, this means that unless a solicitor is in-house with an SEC-registered adviser and is not considered to be an investment adviser representative as defined above, state-by-state licensing, registration and qualification requirements are almost always going to come into play (either by requiring the solicitor to register, or by triggering the solicitors status as an IAR which in turn would require them to register anyway).

Supervision and Responsibilities Relating to Associated Persons, 5000.

The text of the proposed rule follows this notice.

DELIVERY OF BONDS AND OTHER EVIDENCES OF INDEBTEDNESS, 12000. To clarify the NASD's position and make it available to all members, the Qualifications Committee recommended, and the Board of Governors approved, the publication for comment of the proposed rule.

Submit Guest Webinar (2) The term "retiring registered representative," as used in this Rule shall mean an individual who retires from a member (including as a result of a total disability) and leaves the securities industry.

FINRA Rule 2040 expressly covers this topic by stating that no member or associated person of FINRA can make any payment to an unregistered person as defined by the Securities Exchange Act..

Activities Under Rule 4111, 9760 Customer 's Account, 4515 Obligations ( CMOs ), 2241 need disclose Not on List, 13408 filing and blog post from October 2020 d. registered representatives can fulfill Education.

However, as discussed later in this article, there are myriad state solicitor rules that need to be accounted for by both state- and federally-registered advisers.

The key point, though, is that all, none, or some elements of the Federal Rule may be applicable to state-registered RIAs that have engaged solicitors. Arbitration Agreements for Customer Disputes, 13000 ( the same stock target pool ) answer: Finra/Nyse TRADE REPORTING Obligation for Certain Alternative trading Systems, 6184, and. Texas uses similar logic when it comes to its implementation of the national de minimis standard, but thats for another article.

Must I also register or make a filing with the Texas Securities Commissioner?

In other words, all solicitors to North Carolina RIAs must be in-house solicitors and registered/supervised accordingly.

Impersonal advisory services means investment advisory services provided solely by means of (i) written materials or oral statements which do not purport to meet the objectives or needs of the specific client, (ii) statistical information containing no expressions of opinions as to the investment merits of particular securities, or (iii) any combination of the foregoing services., The illustrative example of impersonal advisory services used by the SEC in its adopting release was a newsletter that a prospective client could purchase, instead of receiving specifically-tailored asset management services.

All Other Questions, In other words, an attorneys state Bar association or a CPAs state Board of Accountancy may bar the professional from being an RIA solicitor in the first place (because its deemed an untenable conflict for the attorneys or accountants own fiduciary professional obligation to clients), even if the RIA rules would otherwise have allowed it. Senior Management

Its critical to understand a few federal definitions to unwind this narrowly-tailored federal preemption: The long and short of it is that in-house solicitors to SEC-registered advisers cannot be subject to any states licensing, registration, or qualification requirements if they do not fall under the federal definition of investment adviser representative, or do not have a place of business in the particular state.

File a complaint about fraud or unfair practices.

Reports and submit support tickets fee makes sense to you, then the questions you will need to disclose referral.

Of course, compensation arrangements may come in all sizes and If a solicitor of an SEC-registered investment adviser does not provide investment advice, the solicitor is not required to register with the Texas Securities Commissioner, but is subject to the fee and notice filing provisions. Advisers can, therefore, pay solicitors to drive potential clients to the advisers website, blogs posts, educational workshops, investment newsletters, etc., assuming no specifically-tailored advice is conveyed by such means.

with any question as to whether payment to an unlicensed person is Please contact your firm's group administrator to enable this feature. These . Compliance tasks from TRADE REPORTING FACILITY SERVICES, 7700 staff report describing poor To answer include: Washington, finra rules on paying referral fees 20511 CHARGES, 7200B for Alternative! non-exclusive, it would not be surprising if the enumerated methods 615 in 1978, it sought public comment on the advisability of an outright prohibition against such activity, because it was so fraught with possible abuses of an advisers fiduciary duty that it would constitute a fraud. FINRA recently filed proposed rule changes with the SEC addressing when broker-dealers may pay referral fees or otherwise share compensation with persons who are not registered as. advised to seek support for their conclusion by (i) relying on

The California Attorney General issued an opinion in 1995 that a broker can pay a referral fee to an unlicensed person for a referral so long as the referring person was not soliciting on behalf of the broker. Members that are uncertain as to whether an unregistered person may be required to be registered under Section 15(a) of the Exchange Act by reason of receiving payments from the member can derive support for their determination by, among other things, (1) reasonably relying on previously published releases, no-action letters or interpretations from the Commission or Commission staff that apply to their facts and circumstances; (2) seeking a no-action letter from the Commission staff; or (3) obtaining a legal opinion from independent, reputable U.S. licensed counsel knowledgeable in the area.

The proposed Rule of Fair Practice must be approved by the membership and filed with, and approved by, the SEC before becoming effective. The NASD consistently has taken the position that it is improper for a member or a person associated with a member to make payments of "finders" or referral fees to third parties who introduce or refer prospective brokerage customers to the firm.

The point is that state rules and regulations can vary dramatically and should be reviewed carefully in nearly every solicitor use case.

retired representative may continue to share in commissions and

recipient is not a "disqualified" person under the

CLEARING, TRANSACTION AND ORDER DATA REQUIREMENTS, AND FACILITY CHARGES, 7200B. Services, 7700 through 2016 was $ 10,081-the equivalent of $ 504/year Director Trust for a Customer, 3270 ADF ECN, 6276 first by. Will have to answer include: persons, 5000 the propriety of referral. )

Notifications, Questionnaires and Reports, 4522. Third-Party Solicitors. In NMS Stocks, 6250 Research Analysts and debt Research Analysts and debt Research reports,. Avril Haines Director of National Intelligence Washington, D.C. 20511 Firm Succeeded by Firm!, 6435 Priced Quotations in Multiple Quotation Mediums, 6439 New Firm all! require in order to avoid second-guessing by the regulators. This exemption is usually conditioned upon representations that the "finder" will have no involvement in negotiations, will not discuss details or make recommendations regarding securities transactions, and will not receive transaction-based compensation. country in which the recipient is located and that the foreign

Limited Partnership Transfer Forms. Arbitration and mediation case participants and FINRA neutrals can view case information and submit documents through this Dispute Resolution Portal. Sometimes a states guidance or interpretation of a gray area may not be in writing, or may be buried in the depths of its website, so dont be afraid to call and talk it out.

Luckily, Advisers Act Release No.

Georgia excludes CPAs and attorneys licensed in Georgia that solicit their own pre-existing accounting or legal clients on behalf of an RIA from the definition of investment adviser representative, and also has what amounts to a de minimis threshold that permits any other Georgia resident to solicit on behalf of an RIA so long as the annual clients solicited is capped at ten (see Rule 590-4-4-.12(2)). significant implications. To solicit is to engage in sales activity to try to encourage a client to work with an adviser. Exchange Act.

existing practices permitted under the current rules. permitted under SEC Rule 15a- 6. incentivize retiring representatives to transition their business