Series 62

Recommendations Professional Conduct And Taxation - Gift Rule

Broker dealers may not pay compensation to employees of other broker dealers. If a broker dealer wants to give a gift to an employee of another broker dealer, it must:

  • Be valued at less than $100 per person per year
  • Be given directly to the employing member firm for distribution to the employee
  • Have the employing members prior approval for the gift

The employing member must obtain a record of the gift including the name of the giver, the name of the recipient and the nature of the gift. These rules have been established to ensure that broker dealers do not try to influence the employees of other broker dealers. An exception to this rule would be in cases where an employee of one broker dealer performs services for another broker dealer under an employment contract.

 




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