Guidance

We offer guidance to firms in the form of podcasts, webinars, FAQs, reports, and more. Use the toggle below to find guidance by topic, type or date. 

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Guidance
Interpretive Letter to Steven K. McGinnis, Loring Ward Securities, Inc.
NASD Rule 2830 - Investment Company SecuritiesOffices of sub-adviser holding training and education meeting is permissible location under Rule 2830(l).
September 28, 2006
Exemptive Letter
Name Not Public
Exemptive relief is granted based on: the representation that the individual did not solicit municipal securities business; the contribution being made prior to his employment at the Firm; the Firm's imposition of Firm-wide information barriers on certain municipal securities business communications: for a specified period, prohibition of the solicitation of new municipal securities business by the individual; and the commitment to a quarterly certification of compliance.
August 30, 2006
Interpretive Letter
NASD Office of General Counsel, Regulatory Policy and Oversight
A Member's Responsibilities Regarding the Outsourcing of Certain Activities
August 15, 2006
Guidance
Memorandum to Address NASD Rules on Secondary Trading in Shares of Exchange-Traded Funds Registered Under the Investment Company Act of 1940
 
August 14, 2006
Interpretive Letter
Interpretive Letter to Eileen Ryan, Esq., Securities Industry Association, and Sarah Starkweather, Esq., The Bond Market Association
NASD Rule 2211 - Institutional Sales Material and CorrespondenceFree writing prospectuses are not subject to Rules 2210 and 2211 or the filing requirements of Rules 2710 and 2720
August 01, 2006
Interpretive Letter
Interpretive Letter to Michael R. Trocchio, Esq., Bingham McCutchen LLP
NASD Rule 2110 - Standards of Commercial Honor and Principles of TradeMember ceasing to offer retail brokerage accounts with investment advisory and prime brokerage services may use negative response letters to accomplish the bulk transfer of its retail brokerage accounts to a newly formed broker-dealer.
June 02, 2006
Exemptive Letter
Name Not Public
Exemptive relief is denied based on: the Firm’s repeated failure to detect Officer A’s contributions in excess of $250; the Firm had actual knowledge of all three of Officer A’s contributions and that the Firm violated the municipal securities ban on two separate ocassions; and the firm failed to discover its own rule violations prior to NASD’s intervention.
May 17, 2006
Report / Study
Report of the Customer Account Transfer Task Force
In response to numerous customer complaints and industry frustration about delays in the transfer of securities accounts from one brokerage firm to another, NASD established the Customer Account Transfer Task Force (Task Force) to consider ways to improve the process of inter-firm customer account transfers. This Report presents the results of the Task Force's deliberations.
May 14, 2006
Guidance
Improving Examination Results - May 2006

May 2006

In a continuing effort to assist member firms' compliance efforts, NASD is issuing this regular communication, "Improving Examination Results." This document has two sections: "Examination Priorities" and "Frequently Found Violations," both of which relate to NASD's routine examinations of firms. While each firm must establish its own compliance programs and supervisory procedures, members have commented that it is very helpful to them when we share our overall priorities.

May 01, 2006
Exemptive Letter
Name Not Public
This request for exemptive relief is granted based on the Firm's representation that the individual did not engage in the solicitation of municipal securities business, as defined by MSRB Rule G-37, the imposition by the Firm of extensive Firm-wide information barriers on certain municipal securities business communications, prohibition of, for a specified period of time, the individual's solicitation of new municipal securities business, a Firm commitment to conduct training or re-training for all Firm MFPs and new hire MFPs, including an on-going annual educational effort, a review of existing Firm procedures and the development of necessary enhancements.
February 23, 2006
Exemptive Letter
Bruce E. Lee, Esq.

The staff granted an exemption from NASD Rule 2790 in connection with new issue offering where all decisions regarding the allocation of shares in the offering are determined at the sole discretion of the issuer.

February 03, 2006
Interpretive Letter
Interpretive Letter to Mr. Alan E. Sorcher, Securities Industry Association & Ms. Sarah A. Miller, ABA Securities Association
NASD reaffirms its policy of exempting members from the requirement to supervise registered bank personnel under Rules 3010, 3030, 3040 and 3050, so long as such persons continue to be supervised by the bank and do not engage in any securities activity for or on behalf of the member firm of which they are registered.
December 12, 2005
Exemptive Letter
Noel M. Gruber, Esq.

The staff granted an exemption from NASD Rule 2790 in connection with new issue offering where all decisions regarding the allocation of shares in the offering are determined at the sole discretion of the issuer, and the involvement of a member in the offering is mandated under state law and limited solely to ministerial functions.

October 18, 2005
 
Noel M. Gruber, Esq.
Kennedy & Baris, L.L.P.
Suite P-15
4701 Sangamore Road
Bethesda, MD 20816

Re:  Request for Exemption from Rule 2790

Dear Mr. Gruber:

October 18, 2005
Exemptive Letter
Name Not Public
This request for exemptive relief is granted based on the representations that the Contributions were made prior to the individual's employment with the Firm, and the individual has never been involved in municipal securities business as defined by MSRB Rule G-37. Additionally, the Firm has agreed to institute information barriers and compensation restrictions, and the contributions have been returned.
October 11, 2005
Exemptive Letter
Name Not Public
This request for exemptive relief is granted based on the Firm's representation that the Contributions were made prior to the individual being employed by the Firm, and that the individual has never engaged in municipal securities business, as defined by MSRB Rule G-37, the return of the Contributions, and the extensive information barriers and compensation restrictions.
October 11, 2005
Exemptive Letter
Name Not Public
This request for exemptive relief is granted based on the Firm's representation that the Contributions were made prior to the individual's employment with the Firm, and that the individual was never engaged in municipal securities business, as defined by MSRB Rule G-37 ("Rule"), and the individual has never solicited municipal securities business from the City or City agencies of whom the Contribution recipients are issuer officials. The Firm agreed to institute certain information barriers, the individual will, for a period of time, be prohibited from soliciting municipal securities business as defined by the Rule, and the individual may not receive any compensation derived directly or indirectly from municipal securities business from City or certain City agencies for a period of time.
September 22, 2005
Exemptive Letter
Name Not Public
This request for exemptive relief is granted based on the Firm's representation that the contributor has never solicited municipal securities business, as defined by MSRB Rule G-37, from the State or entities or agencies connected with the State of whom the contribution recipient is considered to be an issuer official, the Contribution was returned, and representations that the Firm has imposed certain limitations on the individual's municipal business solicitation, and receipt of compensation from the Firm's municipal securities business with the State or State agencies.
September 20, 2005
Notice
Notice to Members 05-59

GUIDANCE

Structured Products

SUGGESTED ROUTING

KEY TOPICS
Internal Audit
Legal and Compliance
Retail
Senior Management		 Derivatives
Options
Structured Products
Structured Securities

Executive Summary

September 12, 2005
Guidance
Improving Examination Results - September 2005

September 2005

In a continuing effort to assist member firms' compliance efforts, NASD is issuing this regular communication, "Improving Examination Results." This document has two sections: "Examination Priorities" and "Frequently Found Violations," both of which relate to the Department of Member Regulation's routine examinations of firms. While each firm must establish its own compliance programs and supervisory procedures, we felt it may be helpful to share our overall priorities.

September 01, 2005
Exemptive Letter
Name Not Public
An exemption is granted based on the following: First, the Firm took prompt remedial action by placing Name in an "inactive status" and directing him to not engage in any work for the Firm. Second, you have represented that Name, prior to being hired by the Firm, was not engaged in the solicitation of municipal securities business, as defined in the Rule, and during his Firm employment as an MFP Name did not engage in municipal securities representative activities and did not solicit municipal business. Third, you have represented that the Firm has a long relationship as an underwriter of municipal securities for County #1 and County #2, and the State and neither the hiring of Name nor his Contributions were necessary to obtain municipal securities business from such issuers. Fourth, the Firm has agreed to undertake an education initiative, as described below, for all employees of the Firm's Municipal Securities Group.
May 25, 2005
Report / Study
Report of the Mutual Fund Task Force: Mutual Fund Distribution

NASD formed the Mutual Fund Task Force (“Task Force”) to consider issues relating to soft dollars, mutual fund portfolio transaction costs and distribution arrangements. The Task Force was established after discussions between the Securities and Exchange Commission (“SEC”) and NASD staffs, to provide guidance to the SEC as it considers these issues.

March 29, 2005
Interpretive Letter
Interpretive Letter to Tamara K. Salmon, Investment Company Institute
NASD Rule 2510 - Discretionary Accounts - Application of NASD Rules 3110, 2510, 2310, and IM 2310-2 to a default IRA account established by plan sponsor in accordance with Department of Labor safe harbor provisions.
March 16, 2005
Notice
Notice to Members 05-17

GUIDANCE

Sanction Guidelines

Effective Date: March 15, 2005

March 01, 2005
Interpretive Letter
Interpretive Letter to Michael R. Trocchio, Esq., Bingham McCutchen LLP
Member ceasing to offer retail brokerage services may use negative response letters to accomplish the bulk transfer of its retail brokerage accounts to an affiliated broker-dealer.
February 03, 2005
Interpretive Letter
Interpretive Letter to George T. Simon, Foley & Lardner, LLP
NASD Rule 2510 - Discretionary Accounts - A member may use the negative response process under Rule 2510(d)(2)(A) to effectuate the transfer to another money market fund of customer free credit balances that have been returned to the member by a fund that has been terminated.
January 26, 2005