FINRA Series 6 Investment Company and Variable Contracts Products Representative ExaminationProcessing Customer Orders and TransactionsHard
A registered representative receives a written customer complaint alleging that their account was mishandled, resulting in significant losses. Which of the following is the MOST appropriate initial action for the registered representative to take?
- AForward the complaint immediately to their supervisor or designated principal.
- BInform the customer that all complaints must be submitted through the firm's legal department.
- CDiscuss the complaint with a colleague to get advice on how to respond.
- DAttempt to resolve the complaint directly with the customer to avoid involving the firm.
Show answer & explanationAnswer & explanation
Correct answer: A. Forward the complaint immediately to their supervisor or designated principal.
FINRA rules mandate that all written customer complaints be forwarded immediately to a supervisor or designated principal. Registered representatives are not permitted to handle complaints themselves. This ensures proper review, investigation, and recordkeeping by the firm.
Why the other options are wrong
- B. While the legal department may be involved, the initial step for the representative is to involve their direct supervisor, not to redirect the client to a different department.
- C. Discussing with a colleague is inappropriate and does not fulfill the regulatory requirement to escalate to a supervisor.
- D. Attempting to resolve a complaint directly is a violation of FINRA rules, as it bypasses the required supervisory review and firm procedures.
Complaint Escalation
The mandatory process for a registered representative to immediately forward any written customer complaint to their designated supervisor or principal for review and action, as required by FINRA rules.
- Applies to all written complaints.
- Must be done immediately.
- Ensures proper supervisory oversight and compliance.
Memory trick: Complaint's Come, Supervisor's the One.