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The Pros, Cons of FINRA’s ‘Maintaining Qualification Program’

you must have heard The Financial Industry Regulatory Authority announced a new initiative called the “Qualification Retention Program”. If you are someone who has FINRA licenses, such as Series 7, that have not yet expired and are not currently registered with a FINRA regulated broker-dealer, this opportunity may be something for you to explore.

With this new program, FINRA licensed professionals will have five years, instead of two, before their license expires while enrolling and running on continuing education.

If you fall into this group, here are some advantages and disadvantages to consider.

What are professionals?

There is an emotional aspect to financial advisors leaving a broker-dealer or hybrid broker-dealer when it comes to potentially losing their FINRA license. After putting so much work into getting those licenses, it’s hard to think about losing them, and all those hours that would go to waste. Stories abound, about mentors making career decisions only to retain those licenses. This new MQP program could provide some much-needed breathing room and perhaps even peace of mind for those who leave a FINRA regulated firm. At the very least, it can give people an emotional and professional buffer so that the impending two-year deadline for registering with BD does not revive the same cycle of stress felt initially when deciding to part ways with BD. Do. It may also discourage advisors from making poor choices in desperation to keep their FINRA licenses, such as attempting to illegally “park” them on BD; Or looking for a career path based on your ability to meet the requirements necessary to keep your license active.

If you want to keep your options open as an advisor, MQP can be very beneficial for you. For example, let’s say you start out with a broker-dealer or a hybrid broker-dealer/RIA, then decide that the independent investment advisory channel was more attractive, only that this type of change would not keep you affiliated with BD, so Your FINRA license will no longer be active. If you enroll in MQP, as long as you maintain your CE and comply with the program requirements, you will have three additional years to explore different areas of financial services, without giving up those licenses.

What are the cons?

I want to make sure that people make sure that you are fully responsible for completing the CE required to be active in the program by December 31st of the fifth year and to stay on top. You cannot rely on your RIA compliance team or your assistant to remind you or do it for you,It is up to you to track it and ensure that you are completing that CE on time. This is a departure from the typical protocol of a compliance team; Emailing you, walking down the hallways and otherwise nagging you to make sure you’ve done your full CE. If you know you’re not the kind of person who can remember to do this all year long and will waste your New Year’s Eve trying to find an emergency CE class, consider this fair warning.

How do you enroll?

MQP Currently open for enrollment; Those who wish to enroll will have to do so before the effective date of March 15.

To be eligible, for MQP purposes, you must have finished registering (U5 filed) with BD on or after March 15, 2020.

If you meet the eligibility requirements and wish to enroll in MQP, follow these steps:

  1. Sign up or log in to FinPro: This is where you review your U4 and enroll eligible licenses, receive notifications from FINRA and track CE completion dates and status.
  2. Complete Required Coursework: Individuals must complete all CE, both firm elements and regulatory materials, by 31 December of each calendar year they remain in the MQP. The coursework for the first year of MQP will become available on July 1, 2022.
  3. Additional information can be found on the FINRA website, or if your questions cannot be answered online, contact the call center at (301) 590-6500.

As regulatory authorities, the objectives of FINRA and the Securities and Exchange Commission are to protect investors; They cannot do so if their licensed persons and fiduciaries do not know the latest rules and regulations. However, both institutions are exploring ways to modernize some of the older requirements, such as the new marketing rule introduced by the SEC, which took effect in May 2021. The MQP program is a means, without losing the integrity of the education of its licensed mentors. To update our criteria for FINRA to fit the current environment of financial advisory practices, which I imagine we will see in the future.

Stacy SizeRead MoreChief Compliance Officer in true freedom, An open architecture platform that provides financial advisors with the full suite of business services needed to operate independently.

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