RIA Compliance Blog
On October 31, 2018 the Financial Industry Regulatory Authority published Regulatory Notice 18-37, which announces the commencement of the 2019 Renewal Program for registered investment advisers and broker-dealers. The 2019 Renewal Program is set to begin on November 12, 2018. On that day, FINRA will release Preliminary Statements to all registered firms via E-Bill. Firms are required to remit full payment of their Preliminary Statements by December 17, 2018.
The Preliminary Statements contain various fees for renewal of state registrations and notice filings. For individuals who are renewing their broker-dealer registrations, FINRA will assess a fee of $45. For investment adviser firms and their representatives who are renewing their registrations, any IARD system fees will be featured on their preliminary statements. For FINRA-registered firms that have one or more branch offices, FINRA will assess a renewal fee of $20 per branch. FINRA will, however, waive one branch renewal fee for each FINRA-registered firm.
Firms may pay their Preliminary Statement fees via E-Bill, a wire transfer, or a check. FINRA’s preferred method of payment is E-Bill. If a firm does not pay the Preliminary Statement fees by December 17, it will be charged a late renewal fee. The late fee will amount to either 10 percent of a firm’s final renewal assessment or $100, whichever is greater, but the late fee can be no more than $5,000. FINRA also warns firms that failure to pay the Preliminary Statement fees by the December 17 deadline could result in the firms becoming unable to do business in the areas where they are registered.
In addition to the Preliminary Statement fees, FINRA-registered firms are also required to complete certain renewal reports. These reports are: (1) the Firm Renewal Report, which names the individuals in the firm’s Renewal Program and billing codes, (2) the Branches Renewal Report, which names the firm’s branch offices that are registered with FINRA, and (3) the Approved AG Reg Without FINRA Approval Report, which names individuals who are not registered with FINRA but are registered in one or more jurisdictions.
For firms who are terminating one or more registrations on December 31, 2018, a post-dated termination filing must be filed on that day. Once the post-dated termination filing is filed, the firm must ensure that any additional required documents, such as Form U5, BR Closing/Withdrawal, BDW, and ADV-W, are filed by December 27, 2018.
Finally, on January 2, 2019, each registered firms’ Final Statement will be released in E-Bill. The Final Statements will detail the status of all firm and individual registrations. If a firm required a fee adjustment due to registration terminations, notice filings, or transitions, that adjustment will be reflected on that firm’s Final Statement.
Parker MacIntyre provides legal and compliance services to investment advisers, broker-dealers, registered representatives, hedge funds, and issuers of securities, among others. Our regulatory practice group assists financial service providers with complex issues that arise in the course of their business, including compliance with federal and state laws and rules. Please visit our website for more information.