FINRA Series 7Processes and Confirms TransactionsEasy
A customer calls a branch office and orally expresses dissatisfaction about a delayed order execution but does not put the complaint in writing or send any written correspondence. Under FINRA Rule 4513, is the firm required to maintain this complaint in its written complaint file?
- ANo, firms are prohibited from documenting oral complaints at all
- BYes, but only if the complaint involves an equity security
- CNo, Rule 4513 only requires firms to retain records of written customer complaints
- DYes, all customer complaints regardless of form must be logged and retained
Show answer & explanationAnswer & explanation
Correct answer: C. No, Rule 4513 only requires firms to retain records of written customer complaints
FINRA Rule 4513 requires member firms to maintain a separate, centralized file of written customer complaints. Purely oral complaints, without any written communication, are not required to be logged under this rule, although many firms choose to document them for internal purposes.
Why the other options are wrong
- A. Firms are not prohibited from documenting oral complaints; they simply aren't required to under this rule.
- B. The security type is irrelevant to whether the complaint retention rule applies.
- D. Overstates the rule — only written complaints trigger the mandatory record retention requirement.
FINRA Rule 4513 — Complaint Records
Requires member firms to keep a separate file of written customer complaints at each office where the complaint was received, retained for at least four years.
- Applies to written complaints only
- Retention period of at least 4 years
- Different from Rule 4530, which addresses reporting to FINRA
Memory trick: 4513 = File it if it's written; oral talk walks away.