General Supervision Flashcards
New account info collection
due date
by the completion of the first transaction (settlement)
New account info no recomendations
name address occupation and name and address of employer. SSN or TID DOB employed by a member firm? Citizenship Introducing RR signature Approving Principal Signature
New account info sutiability
If making recomendations Income net worth tax status # of Dependants Investment objectives risk tolerance other holdings
Suitability and recommendations
if suitability questions can’t be completed no recommendations. Merely bringing a municipal to the view of a client is a recommendation
Unsuitable transactions
If the RR tells the client it’s an unsuitable transaction and the client insists the ticket should be marked unsolicited
Customer Signature
unless discretion or hypothication is in place no customer signature is required to open the account.
Note that a predispute arbitration clause or w9 require a signature these docs are normally separate from the account agreement.
Principals that can approve account opening
Municipal Securities Principal
Municipal securities sales principal
general securities principal
Institutional account definition
- bank savings and loan, insurance company or registered investment company.
- an investment adviser registered under the IA act of 1940 or regeistered with a securities commission
- any entity with total assets of at least 50M
a natural person can qualify
account information
institutional clients
Name residence or principal business address Tax ID Suitability info, not including tax status RR sig Principal Sig
Control Relations
Must be disclosed at or prior to a recommendations and disclosed in writing prior to completion of the transaction. Normally it’s on the confirm
Disbursements
must be in the account name not in the name of any authorized third party.
not held orders
discretion as to price and time
Principal Approval of Discretionary accounts
Must be a Municipal Principal or Municipal sales Principal
Joint account signature
requires both parties sign
TOD account
Upon Death
Avoids probate but is included in the estate
Passes automatically to beneficiary
guaranteed accounts
If a customer has multiple accounts they can pledge the other accounts for margin together.
number account
signature
must have in writing acknowledgement of ownership
partnership is a
Unincorporated association of two or more individuals.
Must provide partnership agreements
Margin
Non-Individual Accounts
Must state in the corporate res or partnership agreement that margin is allowed.
Trusts must also state that margin is allowed
Employee related accounts
Questionaire
NOt required to ask if the spouse works for another firm.
Fiduciary account
Giving Discretion
A fiduciary can not give discretion to another party and is the only one that can trade in the account.
Guardian Court Order
To open the account the paperwork can not be older than 60 days.
UGMA UTMA
Trading RUles
- The guardian is considered to have third party trading authority
- If donor is the same as guardian a fee can’t be charged.
UGMA UTMA
Account Infor
Guardian - CUstodians Name & SSN
Bene - Name SSN DOB
Taxes are the benes obligation
Custodian can name a successor custodian
UTMA UGMA
Margin
Margin is not allowed and the securities can also not be pledged for any sort of collateral
UGMA UTMA
Account Guidelines
Assets must be reinvested timely
Funding is an irrevocable gift but can be cash or securities
all withdrawals must be documents
Minor can sue custodian
Investment Adviser
defined
Manages assets for a fee.
Omnibus Account
Single master account in the name of the IA. Must disclose to the member firm that the account is for customers
DVP account
dvp is delivery of securities purchased vs. payment
rvp is receipt of funds for delivery of sold securities
dvp/rvp
order ticket
must be marked either DVP OR RVP
dvp/rvp
confirms
must be sent on execution
dvp rvp
settlement and payment
settles regular way
if there is a settlement issue outside of the customers willingness to pay the member has up to 35 calendar days form the transactoin date to obtain payment.
DVP RVP
DEPOSITORY eligible securities
Member firms are expected to use a automated real time trade matching system (RTTM) when dealing with depository eligible securities.
