I want to start my own brokerage company, how do I become a member of FINRA?

By Shauna Carther AAA
A:

Before you read on, note that the Financial Industry Regulatory Authority (FINRA), (previously the National Association of Securities Dealers (NASD), requires prospective members to strictly follow a lengthy application process. This includes providing the association with an extensive amount of information within a certain period of time, as well as attending an interview. As such, FINRA says it is extremely important for a prospective member to understand the requirements, rules and procedures before beginning the process.

According to FINRA Rule 1010, some items that must be submitted include:

  • Form BD
  • A FINRA-approved fingerprint card
  • A detailed business plan
  • Documentation of regulatory, cival or criminal actions
  • A description of the prospective member's financial and supervisory controls
  • A copy of final or proposed contracts with financial intermediaries
  • And Much More... For the full list, please refer to FINRA Rule 1010 for more information.

Once the required information has been submitted on time, the prospective member is then interviewed by its Department of Member Regulation. From there, the department decides whether or not to accept the application based on whether the prospective member meets the standards set forth in FINRA Rule 1014.

Click Here to read detailed instructions from FINRA on "How to Become a Member of the NASD".

RELATED FAQS

  1. What are unregistered securities or stocks?

    Before securities, like stocks, bonds and notes, can be offered for sale to the public, they first must be registered with ...
  2. How does FINRA differ from the SEC?

    With all the financial organizations out there, knowing what they all do can be as complicated as knowing where to invest. ...
  3. What is the Dodd-Frank Act? How does it affect me?

    The Dodd-Frank Wall Street Reform and Consumer Protection Act is a massive piece of financial reform legislation passed by ...
  4. Are there regulations against monopolies?

    A monopoly occurs when a single company or group owns all or nearly all of the market for a particular type of product or ...
RELATED TERMS
  1. Financial Action Task Force (FATF)

    An intergovernmental organization that designs and promotes policies ...
  2. patent attorney

    A lawyer with expertise in intellectual property law as it pertains ...
  3. Patent Pending

    Wording inventors use to let the public know they've filed a ...
  4. Provisional Patent Application

    A short-term means of protecting an invention that requires less ...
  5. Utility Patent

    A patent that covers the creation of a new or improved – and ...
  6. Design Patent

    A patent protecting the unique visual qualities of a manufactured ...
comments powered by Disqus
Related Articles
  1. Material Adverse Effect A Warning Sign ...
    Markets

    Material Adverse Effect A Warning Sign ...

  2. Changes In Tax Legislation And Regulation
    Taxes

    Changes In Tax Legislation And Regulation

  3. SEC Filings: Forms You Need To Know
    Investing Basics

    SEC Filings: Forms You Need To Know

  4. Footnotes: Early Warning Signs For Investors
    Retirement

    Footnotes: Early Warning Signs For Investors

  5. How To Become A Corporate Board Member ...
    Personal Finance

    How To Become A Corporate Board Member ...

Trading Center