Experience the Quality With Free Series 26 License Exam Questions That Helps Candidates Pass

FINRA requires annual inspections of OSJs, which are offices with supervisory responsibilities such as reviewing customer accounts, approving advertising, or supervising branch activities. Non-OSJ branch offices may be inspected every three years, depending on the firm’s risk profile. These inspections evaluate compliance with firm policies, FINRA rules, and federal securities laws. Annual inspections help firms identify weaknesses in controls, enforce supervisory obligations, and address risks that could expose customers or the market to harm.

The reasonable basis obligation of Rule 2111 requires reps to understand a product before recommending it. Supervisors must ensure reps are trained on product risks and features.

BrokerCheck allows the public to access registration, disciplinary history, and background of registered brokers and firms. It is managed by FINRA to enhance transparency for investors.

FINRA requires two-year record retention for retail communications, measured from the date of last use. These records must include the principal approval and the final version of the material. Longer retention (3–6 years) applies to other firm records such as blotters, trade confirmations, and general ledgers.

Rule 3260 governs discretionary accounts and prohibits unauthorized trades. Supervisors must ensure reps have written authority before exercising discretion.