A newly registered representative is reviewing regulatory standards regarding gifts, political contributions, and outside business activities. Which of the following statements accurately describe compliance requirements under FINRA and MSRB rules? (Select all that apply.)
- Prior written notification must be provided to the employing broker-dealer before a registered representative engages in any compensated outside business activity.Answer
- A Municipal Finance Professional (MFP) may contribute up to $250 per election to an official's campaign if the MFP is eligible to vote for that candidate without triggering a 2-year prohibition on negotiated business.Answer
- CRegistered representatives may give unconditional business gifts valued up to $250 per recipient each year to employees of other firms.
- DViolating MSRB Rule G-37 pay-to-play rules results in a 6-month suspension from conducting all general corporate equity trading.
Answer
The correct statements state that prior written notification to the broker-dealer is required for compensated outside business activities, and that an MFP may contribute up to $250 per election to a candidate for whom they are eligible to vote without triggering a two-year ban on negotiated municipal business.
Under FINRA Rule 3270, registered representatives must give prior written notice to their employing firm before engaging in any outside business activity for compensation. Under MSRB Rule G-37, Municipal Finance Professionals (MFPs) are permitted to contribute up to $250 per election to candidates they are eligible to vote for without triggering a restriction on negotiated municipal securities business.
Step-by-Step Solution
Key Concept
FINRA Rule 3270 (Outside Business Activities), FINRA Rule 3220 (Gifts and Gratuities), and MSRB Rule G-37 (Political Contributions)