Authorized broker is a type of securities broker. Brokers must be licensed to sell securities, unless they are exempt from registration in another state. Some examples of securities include municipal and government securities. However, it’s not all about securities; there is also an exception for brokers who have an Intrastate license.
Authorized broker
You can become an Authorized Broker in Connecticut by taking the state’s exam. To do so, you will need to have an employer sponsor you. To do this, your employer must file an application called a Uniform Application for Securities Industry Registration, or Form U4, also known as a Series 7 license application. This application must be processed through FINRA’s CRD system. Once approved, you will have 120 days to take the exam. To make sure you can pass the exam, you should start preparing early.
To qualify as an Authorized Broker, you must have completed a minimum of 150 hours of education. These courses must include at least a 90-hour broker general course, a thirty-hour agency/ethics course, and a thirty-hour office management/related topics course. If you have taken courses in another country, you must also obtain an evaluation from a foreign credential evaluation service.
Intrastate exception from registration for municipal and government securities
Municipal and government securities dealers and advisers are required to be registered with the Commission. These registrations are subject to certain conditions. The Commission has the discretion to suspend registration for public interest, protection of municipal entities or obligated persons, or to impose withdrawal conditions. If a municipal adviser or dealer fails to comply with the Commission’s requirements, he or she may be required to cease business.
Under the intrastate exception from registration, securities sold to accredited investors (high net worth or knowledge) are exempt from registration. However, the purchasers must be residents of the state where the securities are being sold. The offering document and certificate must also clearly state resale restrictions. Other types of securities that are exempt from registration are most life insurance contracts, variable life policies, and variable annuities. Moreover, most commercial paper and bankers’ acceptances are exempt from registration.
Duty of best execution in SRO rules
The duty of best execution is an important aspect of broker-dealer performance. However, the SRO rules do not specifically define what the duty of best execution means. This means that brokers have to use proprietary feeds to determine the best execution. This principle also applies to algorithmic orders. A broker-dealer’s best execution obligation may be different than its customer’s.
Regulating associated persons
The Securities Exchange Act of 1934 regulates the activities of associated persons of an authorized broker. These people must pass a securities qualification examination before they can participate in securities transactions. These people may be employees or independent contractors. Their responsibilities may include acting as a stock broker or registered representative. The Act also requires them to register with a self-regulatory organization. These organizations include the National Association of Securities Dealers, the Financial Industry Regulatory Authority, and the National Securities Exchange.
To be registered with the SEC, most “brokers” and “dealers” must join one of the self-regulatory organizations. However, some “brokers” are exempt from registration. For example, those who are only licensed to trade in commercial paper, bankers’ acceptances, and commercial bills do not have to register. However, broker-dealers that deal in government securities must register under Section 15C of the Act.