Securities Industry Essentials (SIE) ExamOverview of Regulatory FrameworkMedium
A broker-dealer firm is onboarding a new employee who will be performing clerical duties, such as handling incoming mail and organizing client files. The employee will not be soliciting business, opening accounts, or executing trades. Under FINRA rules, what is the registration requirement for this individual?
- AThey must obtain a Series 7 license.
- BThey must obtain a Series 6 license.
- CThey must obtain a Series 99 (Operations Professional) license.
- DThey are not required to be registered with FINRA.
Show answer & explanationAnswer & explanation
Correct answer: D. They are not required to be registered with FINRA.
Individuals performing solely clerical or administrative duties that do not involve soliciting securities business, opening accounts, or handling customer funds/securities are generally not required to be registered with FINRA. Registration is mandated for those engaged in activities requiring a securities license.
Why the other options are wrong
- A. Series 7 is for general securities representatives, involving sales and trading.
- B. Series 6 is for investment company and variable contracts products, involving sales.
- C. Series 99 is for operations professionals who handle back-office functions that impact customer accounts, often requiring more than purely clerical duties.
FINRA Registration Requirements (Clerical)
Individuals performing solely clerical or administrative tasks that do not involve direct customer contact related to securities business, solicitation, or handling of funds/securities are generally not required to be registered with FINRA.
- Registration depends on the function performed, not just employment by a broker-dealer.
- Clerical duties like mail handling or file organization are typically exempt.
- Any activity involving securities sales, advice, or direct customer account responsibilities requires registration.
Memory trick: No customer talk, no trading walk, no license shock.