Which of the following is exempt from Finra Rule 5130?

November 18, 2020 Off By idswater

Which of the following is exempt from Finra Rule 5130?

Under Rule 5130, an investment company organized under the laws of a foreign jurisdiction is exempt if 1) it is listed on a foreign exchange for sale to the public; and 2) no person owning more than 5 percent of the foreign investment company is a Restricted Person.

Who is a restricted person under Finra Rule 5130?

For purposes of these rules a “restricted person” as the term is used this this alert, includes the following: (1) broker‑dealers; (2) broker-dealer personnel; (3) finders and fiduciaries; (4) portfolio managers; and (5) persons owning a broker‑dealer and (6) in certain cases persons materially supported by those in (1 …

What finra 5131?

Overview – The Rules – Rule 5131 prevents broker-dealers from allocating new issues to individuals who have the authority or ability to direct their company’s investment banking business to the broker-dealer making the allocation.

Who is considered immediate family by finra?

The term “immediate family” means parents, grandparents, mother-in-law or father- in-law, spouse or domestic partner, brother or sister, brother-in-law or sister-in-law, son-in law or daughter-in-law, children, grandchildren, cousin, aunt or uncle, or niece or nephew, and any other person who resides in the same …

What is a covered person under FINRA?

(5) Definition of Covered Person For purposes of this Rule, the term “covered person” means any person, other than a Foreign Associate, registered with FINRA pursuant to Rule 1210 , including any person who is permissively registered pursuant to Rule 1210 .

Can a restricted person buy an IPO?

The short answer to “who can invest in an IPO?” is quite simple: aside from restricted persons, any individual investor who considers the investment to be suitable is allowed to invest!

Who is covered under FINRA?

FINRA Regulates Broker-Dealers, Capital Acquisition Brokers, and Funding Portals. A Broker Dealer is in the business of buying or selling securities on behalf of its customers or its own account or both. A Capital Acquisition Broker is a Broker Dealer subject to a narrower rule book.

What are FINRA new issues?

“New issue” means any initial public offering (IPO) of an equity security as defined in Section 3(a)(11) of the Securities Exchange Act of 1934 made pursuant to a registration statement or offering circular, subject to some exceptions. See FINRA Rules 5130(i)(9) and 5131(e)(7).

Can a registered rep be a trustee?

Customers give registered representatives authority to act on their behalf when they provide authorization to engage in discretionary trading or permit registered representatives to act as trustees or co-trustees, hold Powers of Attorney or serve as executors or beneficiaries.

What are rules 5130 and 5131 of FINRA?

Rules 5130 and 5131 (the “Rules”) promote fairness in the allocation of new issues of equity securities. Rule 5130 prevents broker-dealers and portfolio managers from receiving shares of equity securities in IPOs (“new issues”).

What are the amendments to rule 5130 and 5131?

FINRA has adopted anti-dilution provisions user Rule 5131 matching those under Rule 5130.

What are the new FINRA rules for issue 1?

The Financial Industry Regulatory Authority (“FINRA”) has amended Rules 5130 and 5131 (together, the “Rules”) to help facilitate capital raising and to ease the administrative burden of the new issue 1 distribution restriction.

How does rule 5131 apply to broker dealers?

– Rule 5131 prevents broker-dealers from allocating new issues to individuals who have the authority or ability to direct their company’s investment banking business to the broker-dealer making the allocation. – Technically, the Rules apply only to broker-dealers, but they impact the operations of