Form 211

AAA

DEFINITION of 'Form 211'

  1. A form that must be completed by a market maker and filed with the Financial Industry Regulatory Authority (FINRA) to initiate or resume quotations for a security on the OTC Bulletin Board, OTC Markets or any similar quotation medium. Form 211 completion indicates that the market maker has satisfied all applicable requirements of SEC Rule 15c2-11, as well as the filing and information requirements of FINRA Rule 6432.
  1. A form that must be submitted to the Internal Revenue Service by a “whistleblower” who seeks to claim a reward for providing information about tax evasion to the U.S. government.

INVESTOPEDIA EXPLAINS 'Form 211'

Since the OTC Bulletin Board (BB) operates as a dealer system, all securities quoted on it must be sponsored by participating market makers. A market maker registers such a security by completing Form 211 unless an exemption applies. Such exemption is granted to an issue if it meets certain criteria – for instance, if it is listed on a regional exchange and is current in its SEC filings – and requires completing a Rule 15c2-11 Regional Security Exemption Form.

As the OTCBB is only a quotation service for FINRA market makers and not a listing service, OTCBB issuers have no listing requirements to meet – unlike issuers listed on stock exchanges. While OTCBB issuers have no financial disclosure requirements, market makers must meet eligibility and regulatory requirements related to quotation display and quotation activity for such securities, which necessitates completing Form 211.

Form 211 seeks information about the issuer and the security in five parts:

  • Part 1 – Issuer and Security Information.
  • Part 2 – Issuer Information.
  • Part 3 – Supplementary Information: Required information includes the identity of persons for whom the quotation is being submitted, issuer trading suspensions within the past 12 months (if applicable) and any other material or adverse information relating to the issuer.
  • Part 4 – This section has to be completed for OTCBB quotation requests only. It seeks information on periodic financial reports filed by the issuer through the SEC’s EDGAR system, or filed with another regulatory authority.
  • Part 5 – Certification: This section has to be signed by the firm employee who can be contacted about information provided in the Form 211, as well as the firm’s registered principal responsible for the application. The signatories attest to the accuracy and reliability of the information accompanying the form.

Most market makers request additional information from the issuer, over and above the Form 211 requirements, as part of their due diligence.

The market maker must submit the completed Form 211 to the FINRA OTC Compliance Unit, along with two copies of the required issuer information, at least three business days before the security can be quoted on the OTCBB. Once the security has been cleared for quotation, Nasdaq’s Corporate Data Integrity Department notifies the market maker that it has been registered in the security and may commence quoting it.

A whistleblower can submit IRS Form 211 to claim a reward unless he or she was employed by the U.S. Department of the Treasury at the time of receiving or providing the information on the tax evasion, or is a present or former federal government employee who received the information in the course of official duties. Form 211 rewards can be substantial, up to 30 percent of the additional tax, penalty and other amounts the IRS Whistleblower Office collects.

RELATED TERMS
  1. OTC Markets Group Inc.

    The owner and operator of the leading U.S. inter-dealer electronic ...
  2. OTCQB

    The venture stage marketplace for smaller or early-stage companies ...
  3. OTCQX

    The top tier of the three marketplaces for trading over-the-counter ...
  4. OTC Pink

    The lowest tier of the three marketplaces for trading over-the-counter ...
  5. Over-The-Counter - OTC

    A security traded in some context other than on a formal exchange ...
  6. Whistleblower

    Anyone who has and reports insider knowledge of illegal activities ...
RELATED FAQS
  1. What do I do if I think an accountant is in violation of the Generally Accepted Accounting ...

    The Financial Accounting Standards Board (FASB) promulgates generally accepted accounting principles (GAAP) in the United ... Read Full Answer >>
  2. What protections are in place for a whistleblower?

    Whistleblowers can play a critical role in ensuring the compliance, safety, honesty and legal fairness of governments and ... Read Full Answer >>
  3. How should a whistleblower report unlawful or unethical behavior?

    Whistleblowing takes many forms. A whistleblower could expose government corruption, expose unethical business behavior or ... Read Full Answer >>
  4. How did the Dodd-Frank Act change whistleblower protection and processes?

    In 2010, the Dodd-Frank Act strengthened and expanded the existing whistleblower program promulgated by the Sarbanes-Oxley ... Read Full Answer >>
  5. How do insurance companies use a whistleblower?

    Fraudulent claims are among the most prevalent and serious business risks that insurance companies face. Many consumers have ... Read Full Answer >>
  6. What should a whistleblower do if their employer retaliates?

    Although specifically prohibited by employment law, employer retaliation against whistleblowers for exposing employers' wrongdoings ... Read Full Answer >>
Related Articles
  1. Investing Basics

    How To Play The OTC Pink Stocks

    The OTC Pink offers a variety of investment candidates including many good companies waiting to be discovered. Recently, the OTC Pink has worked hard to improve the service by tiering companies ...
  2. Investing Basics

    OTCBB and OTC Markets Group

    The majority of larger companies that trade publicly choose to list their stocks on one of the major exchanges - the NYSE or Nasdaq. However, many companies are unable to meet the financial or ...
  3. Taxes

    How To Report A Tax Cheat

    If you report a tax evader to the IRS, you could be eligible for a reward.
  4. Taxes

    Taking Advantage Of Property Tax Abatement Programs

    Increase your home's value without increasing your property taxes.
  5. Retirement

    Top Tax Tips For Retirees

    Filing your taxes during retirement can be just as time consuming as when you were employed. We have some tips to help you out.
  6. Taxes

    The Truth About IRS Tax Settlement Firms

    These companies claim that they can reduce or even eliminate what you owe to the IRS. Find out the facts behind this alluring fiction.
  7. Taxes

    Increase Your Tax Refund With Above-The-Line Deductions

    Find out about these deductions and how you can use them to lower your tax bill.
  8. Taxes

    How Your Tax Rate Is Determined

    Feel like the government always has its hand in your pocket? Learn the theory behind how it decides how much to take.
  9. Taxes

    Parties For Taxes: Republicans Vs. Democrats

    Read about the political parties' differences in tax ideology, and how it can affect your paycheck.
  10. Taxes

    Filing Your First Tax Return

    Tax time can be intimidating - but knowing these tips can ease the process and get you a hefty return.

You May Also Like

Hot Definitions
  1. Nuncupative Will

    A verbal will that must have two witnesses and can only deal with the distribution of personal property. A nuncupative will ...
  2. OsMA

    An abbreviation for Oscillator - Moving Average. OsMA is used in technical analysis to represent the variance between an ...
  3. Investopedia

    One of the best-known sources of financial information on the internet. Investopedia is a resource for investors, consumers ...
  4. Unfair Claims Practice

    The improper avoidance of a claim by an insurer or an attempt to reduce the size of the claim. By engaging in unfair claims ...
  5. Killer Bees

    An individual or firm that helps a company fend off a takeover attempt. A killer bee uses defensive strategies to keep an ...
  6. Sin Tax

    A state-sponsored tax that is added to products or services that are seen as vices, such as alcohol, tobacco and gambling. ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!