Thursday, January 21, 2010

Workin' outside the firm--hey, it's MY business!

Many agents don't understand how much control their broker-dealer actually has over them. Many think they can maintain investment accounts all over the place that their firm knows nothing about, for example. Others think they can call their clients to interest them in some real estate investment they're cooking up with their brother-in-law. How would you answer a very likely exam question such as the following?

When an agent of a broker-dealer would like to give harpsichord lessons for compensation just two times per week
A. the employing broker-dealer may not restrict or prohibit this activity
B. the employing broker-dealer must grant written permission
C. the agent must provide prior written notification to the employing broker-dealer
D. the agent must provide prior written notification to the broker-dealer if compensation exceeds $100

EXPLANATION: there is some hair-splitting going on here. Does the broker-dealer need to grant written permission? No. Can they tell you not to do it? Yes. Anytime you want to work outside the firm for compensation, notify your supervisor in writing.


No comments:

Post a Comment