About This Chapter
Customer Updates & Record Retention - Chapter Summary
As you progress through this chapter, you'll study customer updates and record retention. You can cover such information as customer account transfers, financial rules and regulations regarding customer transactions, and investment account closure procedures. You'll also look at requirements for investment advisor books and records. These thorough lessons ensure you are able to:
- Communicate profits, losses, and account value to customers
- Apply FINRA Rule 2232 to customer confirmations
- Transfer accounts between broker and dealer
- Know the CBOE rules for customer updates, transfers, and transactions
- Utilize knowledge of FINRA Rule 409T and apply it to the statement of accounts to customers
- Create account statements for penny stock customers
The flexibility and convenience of this chapter allows you to make the most of your time as you gain the essential knowledge you need to pass your exam. The lessons allow you to brush up on key concepts and then utilize the quizzes to check your understanding. If you need clarification on any of the material, you will be able to consult the subject-matter experts for help.
1. Understanding FINRA Rule 2232: Customer Confirmations
In this lesson you will learn about the concept of markup on fixed income securities and when and how that markup must be communicated to customers in their trade confirmations.
2. Customer Account Transfers: Financial Rules & Regulations
In this lesson, we will review guidelines regarding customer account transfers as outlined in FINRA Rule 2273, FINRA Rule 11870, and MSRB Rule G-26. There will be a short quiz following the lesson.
3. Transferring Accounts Between Broker-Dealers
In this lesson, you'll learn the back office mechanics of how securities are transferred between broker-dealers using the Automated Customer Account Transfer Service (ACATS) and transfer agents.
4. Investment Advisor Books & Records Requirements
This lesson discusses the Code of Federal Regulations Rule 204-2 which details the recording and bookkeeping requirements for investment advisers. The types of records and how they are to be maintained are described.
5. Investment Account Closure Procedures
What are the procedures for closing an investment account if the investor initiates? What about if the custodian initiates? We'll go over the different closure methods and their related procedures.
6. Understanding FINRA Rule 409T: Statements of Accounts to Customers
Rule 409T mandates that all customers with investments must receive a quarterly statement. This lesson will discuss that rule, its requirements and why it is important for someone with investments to look at their statement.
7. Account Statements for Penny Stock Customers
This lesson will describe the purpose of monthly account statements for penny stock customers and certain SEC requirements, specifically regulation 156-6, Account Statements for Penny Stock Customers.
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Other chapters within the Series 7 Exam: Study Guide & Practice course
- Advertising & Public Communication in the Securities Industry
- The New Issues Market
- New Issue Regulations in the Securities Industry
- Brokerage Account Types & Restrictions
- Retirement Plans & Tax-Advantaged Accounts
- Handling Customer Investment Information & Discretionary Accounts
- Obtaining Supervisory Approvals for Investment Accounts
- Analyzing Customer Investment Profiles
- Analyzing Customer Financial Statements
- Understanding Equity Securities
- Tax Treatment of Equity Securities Transactions
- Packaged Investment Products
- Variable Life Insurance & Annuities
- Real Estate Investment Trusts
- Direct Participation Programs
- Understanding Options in Investing
- Debt Securities
- Investing in Corporate Bonds
- Municipal Securities
- Municipal Securities Analysis & Regulations
- Registered Hedge Funds
- Asset-Backed Securities
- U.S. Government Agency Securities
- Investment Product Disclosures
- Customer Transactions & Confirmations
- Transactional Delivery Obligations & Settlement Procedures
- Investment Disputes & Customer Complaints
- Addressing Margin Issues