Resignation of a Registered Representative

If a registered representative voluntarily resigns or has their association with a member firm terminated for any reason, the member must fill out and submit a Uniform Termination Notice for Securities Industry Registration, known as Form U5. The member must submit the U5 to FINRA within 30 days of the termination. The member firm is also required to give a copy of the U5 to the representative upon termination. The member must also state the reason for the termination, either voluntary or for cause. An associated person’s registration is non-transferable. A representative may not simply move their registration from one firm to another. The employing firm that the representa­tive is leaving must fill out and submit a U5 to FINRA, which terminates the representative’s registration.  The new employing firm must fill out and submit a new U4 to begin a new registration for the associated person with the new employer. The new employer is required to obtain a copy of the U5 form filed by the old employing member either from the employee or directly from FINRA within 60 days of submitting the new U4. The previous employer is not required to provide a copy to the new member firm. If the new employing member asks the associated person for a copy of the U5, they have two business days to provide it. If the member requests a copy of the U5 from the agent who has not received a copy of their U5 from their old employer, the agent must promptly request it from their old employer, and must provide it to their new employer within two business days of receipt. A representative who leaves the industry for more than 24 months is required to re-qualify by exam. During a period of absence from the industry of two years or less FINRA retains jurisdiction over the representative in cases involving customer complaints and violations.

TAKE NOTE!

A firm may not allow an inactive agent to “park” their license with the firm and may not maintain an inactive agent’s license on the books simply to ensure that the agent does not have to re qualify by exam.  The one exception to the rule is for agents in the military who are called to active duty. While on active duty the agent’s registration will be “tolled” until they return.

Pass the Series 10 exam!

REGISTRATION EXEMPTIONS

Related Articles
  1. Insights

    FINRA: How It Protects Investors

    Find out the history of FINRA, and how it's organized to monitor the markets and protect investors.
  2. Investing

    How Real Estate Agent and Broker Fees Work

    Buying or selling a home? What you need to know about real estate agent and broker fees.
  3. Financial Advisor

    Introduction to the Series 65 exam

    The Series 65 is required in many states in order to be a fee-based advisor. Find out what it is and whether you need it.
  4. Financial Advisor

    On The Record: Communications With The Public

    NASD Rule 2211 can make or break your career as a registered principal.
  5. Financial Advisor

    Breaking Down Financial Securities Licenses

    Find out which exam you need to begin your career as an investment professional.
  6. Investing

    What Real Estate Agents Don't Want You To Know

    While they can be instrumental in helping you buy or sell a home, real estate agents may ulterior motives.
  7. Financial Advisor

    Succeeding At The Series 63 Exam

    Your career as a securities agent begins with this test. We'll show you how to score high.
  8. Investing

    How To Find The Best Real Estate Agent

    Most people don't have the time, expertise or motivation to go it alone and finding a good real estate agent becomes essential to enjoying a smooth real estate transaction.
  9. Financial Advisor

    Investigating The Securities Police

    Learn about the history of FINRA and how this organization protects investors.
  10. Investing

    What Are The Differences Among A Real Estate Agent, A Broker And A Realtor?

    All three work in the real estate field, but there are differences between the job descriptions.
Frequently Asked Questions
  1. Which Schools Did Warren Buffett Attend?

    Warren Buffett attended multiple prestigious schools on his path to success, but he places much more significance on real-world ...
  2. What are some examples of expansionary monetary policy?

    Learn about expansionary monetary policy and how central banks use discount rates, reserve ratios and purchases of securities ...
  3. What is the role of the nation-state in globalization?

    Learn about the evolving role of the nation-state in an increasingly globalized world as fewer boundaries restrict international ...
  4. What are some examples of positive correlation in economics?

    Learn the most common examples of positive correlation in macroeconomics and microeconomics, including demand and price, ...
Trading Center