Overview

Welcome! This section introduces the New Membership Application (NMA) process. It describes the major steps in the process and what to expect along the way.

Notice that the Start section has five sub-tabs. These generally follow the major steps in the process. They cover the following topics:

• Overview - a general introduction to the New Membership Application process
• Registration - key registration issues to be considered
• Membership Application - information to help you prepare for and complete the Form NMA
• Interview - the role of the membership interview and how to prepare for it
• Decision - the types of decisions issued by the Staff and the accompanying membership agreement

The sequence of major steps in the application process is as follows.

Major Steps in the New Member Application Process       

Start Applicant prepares and submits original, notarized Form BD & Web CRD Entitlement Forms.

Orientation Applicant accesses and reviews Applicant Interface to understand NMA Process.

Registration Requirements Applicant prepares and submits Forms U4 and BR.

Membership Application Applicant prepares and submits Form NMA and any additional information required.

Interview Staff schedules and conducts interview.

Decision Staff issues decision on Application and Membership Agreement as appropriate.

This Overview section provides information on the following topics. You may click on any link to skip directly to that topic.

• Rules Governing the NMA Process
• Membership Application Components
• Membership Application Process
• How Membership Applications are Evaluated
• Timelines and Dependencies
• Tips and Helpful Reminders

Rules Governing the NMA Process

New membership applications are submitted and reviewed pursuant to the standards for admission in the NASD Rule 1010 Series. These rules were designed to create uniform standards for admission and access to FINRA. The Rules provide important information about new membership requirements and  the admission process, including:

• Requirements and review criteria for membership and registration
  
  
• Milestones, or critical events, associated with the new membership application process
  
  
• Standards for admission that must also be met continually throughout a firm's membership
  
  
• The responsibilities of the parties involved in the application process

Take a few moments to familiarize yourself with the requirements of the NASD Rule 1010 Series, as this will give you a better understanding of the standards that your application will have to meet in order to obtain approval.  

Membership Application Components

In addition to the Form BD that you have filed, an application for membership consists of these major components: 

• Forms U4 for proposed principals and other associated persons
  
  
• Form BR for each proposed location
  
  
• Form NMA and related attachments

See the Registration Requirements tab for additional details on Forms U4, BR, and BD, and the Membership Application tab for details on Form NMA and related attachments.

Note that during the course of the application review, the FINRA Staff may have additional questions or require additional clarification regarding any of these components. In responding to these questions, you have the opportunity to provide additional clarity regarding the Applicant and its proposed business activities. These clarifications may include, but not necessarily be limited to, amendments to one or more of the forms submitted or changes to supporting documentation. The more comprehensive the information provided in the application, the less likely it will be that many requests for additional information will be necessary. You are therefore encouraged to ensure that the application is as complete and accurate as possible, as this will facilitate a more efficient review and prompt decision by the Staff.

Note that the entire application is ultimately composed of the initial information and documentation submitted by the Applicant and any information that the Applicant subsequently provides to the Staff.

Reminder: An Applicant has an ongoing obligation to keep its entire application current and accurate at all times in accordance with NASD IM-1000-1.

Membership Application Process

• Filing the Application: The Applicant is required to file Form NMA electronically in accordance with NASD Rule 1013. The Applicant may be required to provide additional information or documentation as stated in NASD Rule 1013(a)(5).
  
  
• Processing: While new membership applications must be filed electronically, the applications are processed on a regional basis. Once an application is accepted for filing, it is assigned to an analyst ("Analyst") for processing. This Analyst will be promptly identified to the Applicant and will gather any additional required information; complete the review of all information and documentation submitted in support of the application; and ultimately develop a recommendation, which FINRA will consider in making a decision on the application.

How Membership Applications are Evaluated

• Substantially Complete Review. Before starting a formal review of your new membership application, FINRA staff will conduct a preliminary review to determine if the application is "substantially complete." The purpose is to ensure that sufficient information is provided to enable the Staff to effectively commence a review of the Application. Note, in particular, the following:
• • All application components designated in the Form NMA must be attached as indicated. You should take care to ensure that the right documents are attached.
    
    
  • An application will be deemed not substantially complete if it is missing information and documentation identified as mandatory. Applications may be deemed not substantially for one or more of the following reasons, among others:
    
  • • Failure to submit a completed Form NMA with all attachments and information designated in Form NMA
      
      
    • Failure to include the necessary FINRA application fees
      
      
    • Use of an obsolete version of Form BD
      
      
    • Failure to include an originally signed and properly notarized Form BD
      
      
    • Submission of illegible documents; and
      
      
    • Failure to submit sufficient information to allow the Staff to commence a meaningful review of the application.
      
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    Applications that are deemed not to be substantially complete will be rejected as not having been filed. A written notification of that determination will be served upon the Applicant. FINRA will also refund the application fee, less $350, which will be retained as a processing fee.
    
    
• Parties Involved in the Application Review Process. The following parties are involved in the review and processing of a new membership application:
• • Central Registration Depository (CRD). FINRA, in partnership with the North American Securities Administrators Association (NASAA), developed CRD, a computerized system designed to streamline the application and licensing processes for securities industry personnel. CRD consists of a central registration information data bank and an application-processing facility, with each of its regulatory participants linked to the central facility through a nationwide network of Web-based online terminals. CRD processes:
  • • Registered representative and principal registration applications;
      
      
    • Application filings for agent registration for state securities agencies and the securities agencies of the District of Columbia and Puerto Rico; and
      
      
    • Application filings for dual membership between FINRA and the American Stock Exchange (Amex), the Boston Stock Exchange (BSE), the Chicago Board Options Exchange (CBOE), the Chicago Stock Exchange (CHX), the New York Stock Exchange (NYSE), the Philadelphia Stock Exchange (PHLX), and/or the International Securities Exchange (ISE). The Applicant must first be approved as a member firm of the appropriate exchanges before individual applications for associated person registration with those exchanges can be filed by the Applicant on Form U4 via Web CRD for processing.
      
      
  • The Web CRD system streamlines the processing of associated person registration filings for FINRA members by allowing them to submit a single form and the combined payment of fees to achieve multiple registrations. In addition, the CRD system's centralized processing functions include Form BD and broker-dealer, registration-related processing for states. Each regulator can advise the applicant if there are additional requirements beyond submitting Form BD to FINRA.
    
    
• Form U4 Notice Queues. Once an applicant gains access to Web CRD through the Entitlement process, FINRA uses firm Notice Queues for Individuals  to notify the Applicant of examination scheduling and results, and registration statuses and deficient conditions. You should review Notice Queues on a regular basis for deficiencies that require amended filings and for records of effective FINRA, state, and exchange registration approvals. Information provided via the Form U4 Notice Queues includes:
• • Approved Individual Registrations: displays individuals with registrations that are Approved, Approved Pending Prints, Approved Pending Results, Restricted Approval, and Temporary Registration.
    
    
  • Current Individual Deficiencies: displays individuals' registrations that have one or more deficiency.
    
    
  • Denied Individual Registrations: displays individuals with registrations that a regulator has Denied or Rejected.
    
    
  • Pending Individual Registrations: displays individuals' non-deficient registrations that are waiting for a Jurisdiction approval.
    
    
  • Disclosure Review: displays individuals that have had a disclosure submitted to CRD through Form U4, U5, or U6 filing.
    
    
  • Outstanding Disclosure Letters: displays individuals that have a disclosure deficiency or inquiry letter that has been sent to the firm electronically and is unresolved. Investment adviser representatives will not appear in this queue.
    
    
  • Fingerprint Status Received from FBI: displays notices from the FBI regarding an individual's fingerprint card status. Investment adviser representatives will not appear in this queue.
    
    
  • Inactive Registration Due to Missing Fingerprint: displays individuals with registration statuses that changed from Approved Pending Prints to Inactive Prints because a fingerprint was not received by FINRA within thirty (30) days. Investment adviser representatives will not appear in this queue.
    
    
  • Notices of Undelivered Fingerprint Cards: displays individuals that have outstanding fingerprint cards. If the card is not received within thirty (30) days from the filing date, the individual will appear in the Inactive Registration Due to Missing Fingerprint Notice queue. Investment adviser representatives will not appear in this queue.
    
    
  • Scheduled Exams: displays individuals that have open exam windows.
    
    
  • Completed Exams: displays exam results for exams taken within a specified time frame.
    
    
• Form BD Notice Queues: Once an applicant gains access to Web CRD through the entitlement process, FINRA uses firm Notice Queues for Organizations to notify the applicant about current deficiencies, member registration withdrawal or termination, and firm retirement from a simultaneous filing group. Applicants and member firms should review Notice Queues on a regular basis to resolve promptly any deficiencies, by way of an amendment to Form BD or otherwise.
  
  Once the initial Form BD is entered on CRD by FINRA staff and the pplicant is entitled to Web CRD access, the Applicant will be able to access the following Notice Queues for information concerning the Applicant's registration:
• • Current deficiencies: lists the Applicant's current Form BD and BDW deficiencies by filing date. The number of days deficient is also displayed. A link is available to obtain deficiency detail information. Notices remain in queue until the deficiency is satisfied.
    
    
  • SFG Retirement: lists the retiring firm for simultaneous filing group, by date of retirement. Notices remain in queue for one hundred twenty (120) days.
    
    
  • Withdrawal or Termination Queue: lists the firm's withdrawal or termination notices by effective date. The screen includes the regulator reason and effective date. Notices remain in queue for one hundred twenty (120) days.
    
    
• Web CRD Accounting. Through Web CRD, FINRA collects and assesses registration-related FINRA fees, and also collects and disburses state and SRO registration fees for firms. In conjunction with creating a data record in the CRD system for each Applicant  that is applying for FINRA membership, FINRA automatically assigns each Applicant a unique CRD identification number. The Applicant's CRD number is used to identify two key financial accounts created for each Applicant : the Daily Account and the Renewal Account.
• • The Daily Account is the primary account that reflects the Applicant's account status. All registration-related charges are debited from this account.
    
    
  • The Renewal Account is the account used by member firms to participate in the annual Renewal Program. The Renewal Program enables firms, firm branch offices, and individuals to maintain an active registration status in the coming year with FINRA, other regulators, and the states in which they conduct business.
    
    
  • All registration, termination, examination, and fingerprint processing fees, and any other registration-associated fees, are automatically charged against the applicant's Daily Account upon submission by a member or member applicant and processing by FINRA of appropriate form filings and associated registration and disclosure information. Renewal fees are assessed annually and payable against the firm's Renewal Account.
    
    
  • Online balance and detailed transaction information for each account is viewable through the CRD system. Account balance information generally is updated after the close of business during an automated nightly reconciliation process.
    
    
  • See the Central Registration Depository Web Site for additional information on these accounts and further details on the payment of fees.
    
    
• The District Office. Staff within the District Office are assigned to process the application. Processing includes an evaluation of whether the application is substantially complete, and if so, the subsequent formal evaluation of the application. (See Substantially Complete Review above for further details on substantially complete.) In a nutshell, the District Office does the following:
• • Within 30 days of receipt of a substantially complete application, the FINRA District Office processing the application will advise the Applicant in writing if any additional information is required to be filed. The Applicant will have 60 days to respond to the FINRA District Office staff's initial request letter for information or documentation.
    
    
  • Within 30 days of the receipt of additional information or documentation from the applicant, the FINRA District Office staff may render a decision on the application or make a subsequent request for information.
    
    
  • Prior to making a decision on the application, the FINRA District Office staff will schedule and conduct a Membership Interview and may schedule a Pre-Membership Examination, when appropriate.
    
    
• The Department of Registration and Disclosure (RAD). This department plays an important role in the review and processing of the new membership application, including the following:
• • Receiving the Form BD with the application, imaging and indexing it, and assigning it to an analyst. The application Analyst sends the applicant written acknowledgment, records the Form BD data into the CRD system, and serves as the applicant's FINRA liaison for that portion of the application.
    
    
  • Performing reviews of the Form U4s and BRs submitted by the Applicant.
    
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  The Analyst will assist with CRD and registration-related information, and provide updates to the Applicant and the FINRA District Office processing the application on the status of the filing and qualification of the applicant's personnel. The analyst will be the primary point of contact for questions concerning the Form U4 and BD Notice Queues (see discussion in Central Registration Depository above), which FINRA uses to provide applicants with notifications concerning the processing of these forms.
  
  Important! Any additional required information or correspondence sent to Registration and Disclosure are to be sent to the attention of the assigned Analyst.

Timelines and Dependencies

The following are important timelines and dependencies that govern the processing of a new member application: 

• Form Filings: Forms U4 and BR must be filed before you begin preparation of the Form NMA. This is necessary because certain portions of the electronic Form NMA will pre-populate in the interests of data integrity. (See the Membership Application tab above for additional details.)
  
  
• CRD Deficiencies: CRD deficiencies, as identified in the Notice Queues (see discussion in the CRD section above) must be resolved before the Applicant can be approved to conduct business.
  
  
• 180 Days: FINRA is required to process the application within 180 days from the date of its receipt of a substantially complete application for membership. Decisions with a later date must be agreed to between FINRA staff and the Applicant.
  
  
• 60 Days: The Applicant has 60 days to respond to the initial request for information unless otherwise agreed between FINRA staff and the Applicant. Failure to timely respond will result in lapse of the application absent a showing of good cause.
  
  
• 30 Days: The Applicant has 30 days to respond to the FINRA staff's subsequent request(s) for information unless otherwise agreed between FINRA staff and the Applicant. Failure to timely respond will result in lapse of the application absent a showing of good cause.
  
  
• 25 Days: The Applicants whose applications for membership are approved, must return an executed Membership Agreement within 25 days of the issuance of a decision, otherwise the application will lapse pursuant to NASD Rule 1012.
  
  
• Membership Interview: Applicants must attend the Membership Interview as scheduled. Failure to do so will produce a lapse of the application pursuant to Rule 1012. (See the Interview tab above for additional details.)
  
  
• Lapses: Where the application lapses, the Applicant will be required to submit a new application and fees.

Tips and Helpful Reminders

As you prepare to commence the remaining steps necessary in filing a new membership application, here are a few tips and suggestions.

1. First, familiarize yourself with the application process and applicable rules and requirements by reviewing the information provided in this Applicant Interface. It will help you better prepare your application and understand the issues raised during the review process.
   
   
2. Ensure that the Form NMA and all attachments and documentation are complete and accurate. Experience has shown that the more complete and accurate an application is, the better situated the Staff is to conduct a prompt, smooth review. If you have questions as you prepare the Form NMA, contact the assigned Member Management Liaison.
   
   
3. Regularly review the Form U4 and Form BD Notice Queues and promptly address any deficiencies that have surfaced in the course of reviewing these forms.
   
   
4. Prepare thorough and timely responses to requests for information from the District Office. If you are unclear about what is required, contact the assigned Analyst for clarification.
   
   
5. Be sure that personnel who require one or more licensing examinations register for and successfully complete these examinations as early as possible, as delays in completing examinations is a major cause of delay in the application review process.

Best wishes as you commence the new membership application process. We look forward to working with you.