Further, those individuals will not be
required to pass the SIE in order to register.
However, if such individuals fail to
pass the current rep-level exam and the
next eligibility date for retaking the exam
is on or after Oct. 1, they will be required
to pass the SIE and the revised rep-level
qualification exam in order to register.
FINRA’s FAQ is broken into five
sections: Former, Current and Future
Registrants; Permissive Registrations;
Financial Services Affiliate Waiver
Program; Principal Financial Officer
and Principal Operations Officer; and
Registered Persons Functioning as
Principals for a Limited Period.
CLARIFYING NEW PRINCIPAL
Jon Hurd, CEO of Asgard Regulatory
Compliance Services in Bohemia, New
York, told IA that his firm has had sev-
eral conversations with FINRA’s general
counsel, and has written two regulatory
briefs for clients, regarding the new
Principal Financial Officer and Principal
Operations Officer designations.
The conversations with FINRA’s general counsel have been to “ensure that
those small [FINRA] members that are
exempt from having to employ or register a Financial and Operational Principal
(FINOP) continue to be afforded that
benefit” under the new designations,
A FINOP is responsible for the maintenance of the broker-dealer’s books
and records and accuracy of the financial statements, compliance with the
SEC’s net capital rules as well as timely
submission of all financial regulatory
reports, Hurd explained.
“Most [broker-dealer] firms we
spoke with intended to have either the
chief executive officer/president fill
these roles. However, they mistakenly
thought they only needed the Series 99,”
“Many firms do not realize that the
PFO and PFO MUST be registered with
a Series 27/28 and a Series 99.”
Hurd said that he believes “these
added responsibilities will materially
impact outsourced FINOPs and the small
broker-dealers they service. Outsourced
FINOPs provide valuable cost effective
accounting and finance support services
at a reasonable cost to small member
firms. In my view, it is logical for an out-
sourced FINOP to act in the PFO role.
However, since they most often times
conduct their roles from a remote loca-
tion, it would be challenging to take on
the Principal Operations Officer role.”
Washington Bureau Chief Melanie Waddell can
be reached at firstname.lastname@example.org.