What is an OSJ inspection under FINRA?
Inspections Depending upon the functions performed at an office or location, it may be classified as an OSJ, supervisory branch office, non-supervisory branch office, or non-branch location under FINRA Rule 3110(c)(1), which specifies the periodicity of the attendant inspection.
What does OSJ stand for in finance?
An Office of Supervisory Jurisdiction (OSJ) is an office identified by the broker dealer as having supervisory responsibilities for agents and branch offices within its region. The OSJ has final approval of new accounts, and retail communication, The OSJ may also make markets or structures offerings. Click to see full answer.
Is an OSJ the same as a branch office?
No. The status of a location as an OSJ or a branch office depends on whether the location meets the definition of an OSJ or a branch office in FINRA Rule 3110 (f). The status of a location is not impacted by whether the individuals at that location are permissively registered.
What are the requirements for an OSJ branch?
An OSJ branch must have at least one on-site supervisor who is a qualified and registered principal with the firm. The main office of each firm is always considered an OSJ and has supervisory jurisdiction and responsibility over all the firm's non-OSJ branch offices.
What is a non OSJ?
Basically, if any sales or solicitation of securities takes place and none of the seven OSJ functions are performed at the office it is a non-OSJ branch.Aug 1, 2016
What is an Office of Supervisory Jurisdiction?
An office of a broker-dealer where any of certain functions takes place, including: Order execution or market making. Structuring of public offerings or private placements. Maintaining custody of clients' funds or securities.Feb 13, 2021
What is a non branch office?
A “non-branch location” would be any location of the member, including but not limited to a main office, that does not qualify as a supervisory branch office, a limited supervisory branch office, or a non-supervisory branch office.
What constitutes a recommendation FINRA?
FINRA Rule 2111 requires, in part, that a broker-dealer or associated person "have a reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer, based on the information obtained through the reasonable diligence of the [firm] or ...
What are written supervisory procedures?
The Written Supervisory Procedures Checklist ("WSP Checklist") is an outline of selected key topics representative of the range of business activities typically proposed by applicants seeking approval to become FINRA members or to expand their existing securities business under NASD Membership and Registration Rules ( ...Feb 15, 2016
What is the 2010 rule?
Rule 2010 requires that all members, in the conduct of business, observe the "highest standards of commercial honor and just and equitable principles of trade." This rule is viewed as somewhat of a "catch-all" rule and it can punish unethical behavior as well as violations of federal securities laws by imposing ...May 16, 2017
What is a branch office FINRA?
NASD designates locations from which associated persons work as either branch offices or unregistered offices/locations. As currently defined, a “branch office” is any location identified by any means to the public or customers as a location at which the member conducts an investment banking or securities business.Oct 14, 2005
What qualifies as a branch office?
A branch office is a location, other than the main office, where a business is conducted. Most branch offices consist of smaller divisions of different aspects of the company such as human resources, marketing, and accounting.
Do home based offices require FINRA approval?
Home-based offices would require FINRA approval. Home-based offices would be subject to site visits by FINRA auditors. provide prior written notice to the employing member firm.
What are the three elements of an appropriate suitability assessment?
05 Components of Suitability Obligations. Rule 2111 is composed of three main obligations: reasonable-basis suitability, customer-specific suitability, and quantitative suitability.
What qualifies as an accredited investor?
The SEC defines an accredited investor as either: an individual with gross income exceeding $200,000 in each of the two most recent years or joint income with a spouse or partner exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year.
What is a 3050 letter?
NASD Rule 3050 states that “a person associated with a member, prior to opening an account or placing an initial order for the purchase or sale of securities with another member, shall notify both the employer member and the executing member, in writing, of his or her association with the other member.” Once a firm ...Jul 11, 2016
What is an OSJ?
Inspections. Depending upon the functions performed at an office or location, it may be classified as an OSJ, supervisory branch office, non-supervisory branch office, or non-branch location under FINRA Rule 3110(c)(1), which specifies the periodicity of the attendant inspection.
What is the 20-08 notice?
Regulatory Notice 20-08(March 2020) regarding pandemic-related business continuity planning, guidance and regulatory relief to member firms from some requirements; Regulatory Notice 20-13(May 2020) reminding firms of the risks and challenges of fraud during the pandemic;
Is there an online test for FINRA?
In addition, since July 2020, FINRA and NASAA have delivered an online testing service for candidat es seeking to take FINRA's Securities Industry Essentials (SIE), Series 6, and Series 7 exams and NASAA's Series 63, Series 65 and Series 66 exams remotely.
Does Finra have the right to redact?
FINRA, however, reserves the right to redact or edit personally identifiable information from comment submissions . FINRA also reserves the right to redact, remove or decline to post comments that are inappropriate for publication, such as vulgar, abusive or potentially fraudulent comment letters.
How many supervisors are required for an OSJ?
An OSJ branch must have at least one on-site supervisor who is a qualified and registered principal with the firm. The main office of each firm is always considered an OSJ and has supervisory jurisdiction and responsibility over all the firm's non-OSJ branch offices.
What is section 3?
Section 3 elicits investment-related business activities conducted by an associated individual at the branch office in addition to the activities conducted at the branch office by the broker-dealer or state registered investment adviser.
What is a BR form?
Form BR enables firms to register a branch office either by "registering" or "notice filing.". Although SROs and jurisdictions may use these terms interchangeably, registering typically refers to a process that requires an approval by FINRA, other SRO or a jurisdiction before a branch office may begin doing business.
Does every NASAA branch have a supervisor?
Every registered branch must have a Supervisor or Person-in-Charge that is registered with the firm. Firms can visit the NASAA website for information on which jurisdictions participate in the Branch Office Registration Program.
What are the requirements for FINRA?
1 These rules, among other things: (1) require the registration of individuals as representatives or principals ; (2) allow for the permissive registration of associated persons of firms; (3) establish a waiver program for individuals working for a financial services industry affiliate of a member firm ; (4) require firms to designate a Principal Financial Officer and a Principal Operations Officer; and (5) set forth requirements for registered persons who are to function as principals prior to passing an appropriate principal qualification examination . The following frequently asked questions (FAQ) provide guidance on the FINRA qualification and registration requirements.
How long does it take to get a waiver from FINRA?
As stated in Regulatory Notice 17-30, to be eligible for the waiver program, FINRA requires individuals to start working for a member’s financial services affiliate promptly and in no event later than 30 calendar days after the member has terminated the individual’s registration.
How long is a SIE valid?
Moreover, your SIE examination will remain valid for four years from the date of termination on your Form U5.
Who may permissively register or maintain the registration (s) of individuals engaged in the investment banking or securities business of
As noted in Answer 2.1, a firm may permissively register or maintain the registration (s) of individuals engaged in the investment banking or securities business of a foreign securities affiliate or foreign securities subsidiary of the firm.
Can a branch auditor maintain a permissively only registration?
In such a case, the branch auditors’ manager could continue to maintain a permissively-only registration, and the designated registered supervisor would need to periodically contact the manager to verify that the branch auditors are not acting outside the scope of their assigned functions.
Who is the principal financial officer?
A Principal Financial Officer or a Principal Operations Officer is permitted to delegate all or some of his or her day-to-day duties to other principals at the firm with the understanding that ultimate responsibility for the function rests with the Principal Financial Officer and the Principal Operations Officer.
Is an OSJ a branch office?
No. The status of a location as an OSJ or a branch office depends on whether the location meets the definition of an OSJ or a branch office in FINRA Rule 3110 (f). The status of a location is not impacted by whether the individuals at that location are permissively registered.
What is FINRA Rule 3110?
Rule 3110 (b) Documentation and Supervision of Supervisory Personnel. 1. When can a firm rely on FINRA Rule 3110 (b) (6) (C)’s limited exception to the prohibition of a firm’s supervisory personnel from supervising their own activities and reporting to , or having their compensation or continued employment determined by, ...
What must a firm do to demonstrate compliance with FINRA Rule 3110 (c) (2)'s requirement to
What must a firm do to demonstrate compliance with FINRA Rule 3110 (c) (2)'s requirement to have a means or method to document customer confirmation, notification or follow-up for transmittals of funds or securities from customers to third parties, to outside entities and to locations other than the customer’s primary residence, and between customers and registered representatives?
What is FINRA 3110?
FINRA Rule 3110(a) (Supervisory System), based on NASD Rule 3010(a), requires a firm to have a supervisory system for the activities of its associated persons that is reasonably designed to achieve compliance with the applicable securities laws and regulations and FINRA rules, and sets forth the minimum requirements discussed below for a firm’s supervisory system.4
What are the new FINRA rules?
The SEC recently approved new FINRA Rules 3110 (Supervision) and 3120 (Supervisory Control System) to replace NASD Rules 3010 (Supervision), 3012 (Supervisory Control System) and corresponding provisions of the NYSE Rules and Interpretations.3 In addition, new FINRA Rules 3150 (Holding of Customer Mail) and 3170 (Tape Recording of Registered Persons by Certain Firms) replace NASD Rules 3110(i) and 3010(b)(2) (often referred to as the “Taping Rule”), respectively. The new rules, discussed in detail below, become effective on December 1, 2014.
What is the FINRA Rule 3120(b)?
FINRA Rule 3120(b) requires a firm that reported $200 million or more in gross revenue (total revenue less, if applicable, commodities revenue) on its FOCUS report in the prior calendar year to include, to the extent applicable to the firm’s business, a:
What are the activity types that firms can select for each registered branch office?
(1) include Retail and Institutional (as types of Sales Activity), Public Finance, and Other; (2) add “Trading” to the existing Market Making activity;
What does BR mean in a branch office?
If the individual is physically located at only one location (i.e., the main office), there are two options: If the main office qualifies as a branch office, select the branch office. (Form BR for that branch will also indicate that the individual is associated with that branch); or.
Can a firm associate a person with a branch office?
No. When a firm associates an individual with a branch office on the Form U4, the individual is considered an "Associated Person" of the branch. In order to designate that individual as a Supervisor/Person-in-Charge, the firm must file a Form BR.
