Financial Industry Regulatory Authority (FINRA) is an independent regulatory body of all securities firms in United States. It supervises brokerage firms, branch offices, and registered security representatives for maintaining fairness and transparency in stock markets. It is responsible for protecting investors by educating them through their website, public forums, and publications. It implements market regulations on contract basis for major stock markets of United States like New York Stock exchange, NYSE Amex, International Securities Exchange, NYSE Arca, and NASDAQ. It is the largest forum in United States which sort out disputes between registered firms and investors.
In order to maintain regulations and uphold reliability in United States capital markets, FINRA enforces requirement of registering with it for all professionals doing one of the securities businesses and affiliated with any of its member firm. Every person whether is partner, director, officer, department supervisor, branch manager, or salesperson requires registering with FINRA. For getting registered, they must pass one or the other qualification exam relevant to the area of securities business they are dealing in.
These registrations are categorized into the following classes-
Registered Principal- Principals are those persons who are employed for managing investment banking and securities business of a member firm. These persons can be sole proprietors, partners, directors, officers, or managers. The qualification exams which come under this category include Series 4 (for Registered Options principal designation), Series 9 and Series 10 (for General Securities Sales Supervisors designation), Series 23 (General Securities Principal – Sales Supervisor Module), Series 24 (for General Securities principal), Series 26 (for Investment Company Products/Variable Contracts Limited principal), Series 27 (for Financial and Operations principal), Series 28 (for Introducing broker/Dealer financial and operations principal), Series 39 (for Direct Participation Programs Limited principal), Series 51 (for Municipal Fund Securities principal), Series 53 (for Municipal Securities principal), and Government securities principal.
Registered Representative- Representatives are those persons who are engaged in investment banking and securities business operations of a member firm. These include assistant officers apart from principals. The qualification exams which come under this category include Series 6 (for Investment Company Products/Variable Contracts Limited representative), Series 7 (for General Securities representative), Series 17 (for Limited Registered representative), Series 37 (Canada module of Series 7 including options questions), Series 38 (Canada module of Series 7 not including options questions), Series 11 (for Assistant representative- Order Processing), Series 22 (for Direct participation Programs Limited representative), Series 42 (Registered Options representative), Series 52 (Municipal Securities representative), Series 55 (for Equity Trader Limited representative), Series 62 (Corporate Securities Limited representative), Series 72 (for Government Securities Limited representative), Series 79 (Limited representative – investment banking), Series 82 (Limited representative – Private Securities Offerings representative), Series 86 and Series 87 (for Research Analyst), and Series 99 (for Operations Professional).
Other Examinations – In addition to qualification exams offered for principal and representative positions, other qualification exams held by FINRA include Series 3 (National Commodity Futures Examination), Series 30 (Branch Managers Examination – Futures), Series 31 (Futures Managed Funds Examination), Series 32 (Limited Futures Examination – Regulations), Series 56 (Proprietary Trader Examinations), Series 63 (Uniform Securities Agent State Law Examination), Series 65 (Uniform Investment Advisor Law Examination), Series 66 (Uniform Combined State Law Examination), and Series 14 (Compliance Officer).