SIE 15 - Compliance Considerations

• Correspondence
• Retail communication
• Institutional communication

• Written or electronic communication that is available to 25 or fewer people within any 30 day period
• Subject to review and supervision

• Written or electronic communication that is available to 25 or more people within a 30 day period
• Subject to preapproval and filing

• Written or electronic communication that a member distributes ONLY to institutional investors (i.e. not retail)
• Subject to review and supervision

Telemarketing calls may be made on any day but only from 8AM to 9PM of the local time of the person being called (only residential numbers)

• Time of day restrictions don’t apply if the person has
• 1) made any unsolicited inquiry of the firm
• 2) engaged in a transaction with the firm in the last 18 months

• 1) Name and firm name
• 2) Firm number and address
• 3) Purpose for the call

• Name of customer (numbered or coded is OK)
• Address (no PO box unless military)
• Legal age or not
• RR of record
• Signature of supervising principal (no client sig needed)
• Provide a copy every 36 months

• Reasonable efforts only required
• Occupation
• Whether associated with member firm or not
• RR should document refusal
• Changes must be made within 30 days

• Reasonable basis: an investment is generally good
• Customer-specific obligation: an investment is suitable for the client
• Quantitative obligation: a series of investments ios not excessive and is diversified

• Ordered by a court/government entity
• Client provides written permission (not entitled to know spouse's account)

• It was created to protect client personal infrmation
• Clients must be provided with a privacy notice upon opening an account and annually thereafter
• It requires a reasonable "opt-out" provision

• 1. Placement: illegal cash placed in BD's business
• 2. Layering: transactions undertaken to avoid detection
• 3. Integration: proceeds from transactions put into the stream of commerce

• Name
• Legal address (residence or business)
• DOB
• ID number
• ID for US persons: tax ID (businesses) or SSN
• Non-US persons: tax ID, passport number, alien ID card number, government-issued document establishing residence + identity

An office of foreign assets control list that maintains terrorists and criminals.

Block transaction and notify law enforcement.

Established under the bank secrecy act (BSA), this is the Federal Crimes Enforcement Network (part of the US Dept. of Treasury).

• Bank secrecy act currency transaction report
• Filed for all transactions by 1 customer in 1 day > $10,000
• Filed within 15 business days

• Suspicious activity report
• Filed whenever a transaction or group of transactions >=$5,000 OR when the firm is suspicious
• Filed within 30 days
• Must report activity to a principal

• Broker/dealers
• Must be sent on or before the settlement of the transaction.

• Name, buy/sell, price, quantity
• Trade/settlement dates
• Firm capacity (agent or principal)
• For bonds- dollar price and yield info
• Name of contra party

Order tickets, confirmations, statements, U4/U5, employee records, communications, and trial balances

Blotters, ledgers, new account forms, POAs, and complaints (really 4 years per FINRA)

Corporate and partnership documents.

Two years