Agent (B/D) Record Keeping Must Register in state if:

IAR (Investment Advisor) Must be kept 3 years Must be kept 5 years (Easy access first 2 years) (Easy access first 2 years) 1) Have physical office 1) Have physical office in state in state 2) If not 1), than have 2) If not 1) have >5 a single Resident Resident clients in client a state 3) 3) If not 3), than have clients other than B/Ds, IAs, and institutional clients

Borrowing from Clients Loans to Clients Sharing in Customer Accts Sharing Commissions If acting as principal for its own account in a transaction involving an advisory account

Not allowed! Can make and receive loans from customers who are banks Can have joint acct with customer. Need written permissions from customer AND firm. Can share with agents at same or affiliated B/Ds B/D must disclose capacity on the confirmation upon trade execution

Not allowed! Not allowed! Not allowed!

Not allowed! IA must disclose capacity in executing transactions to a client before entering the order

Exempt Transactions

Non-issuer transactions Unsolicited Orders Transactions amoug underwriters and issuers Fiduciary Transactions (trustees, guardians)

FUN PUMI Fiduciary, Underwriter/Issuer, Non-issuer transactions, Private Placement, Unsolicited, Mortgage Secured Bonds, Institutional Sales Bona Fide Pledges Institutional Sales Rights Sales Pre-organization Subscription

Private Placements (<= 10 Offers) Mortgage Secured Bonds

Offers prior to effectiveness of the registration

Not A Security Fixed Annuities/Fixed Life Insurance Retirement Plans: IRAs Shares issued by Non-Profits Commodities (& Futures on Commodities) Real Estate Currency Federal Covered Security Exchanged (National Traded Securities i.e. Nasdaq, NYSE, etc -includes all senior to those traded on exchange (bonds, rights, warrants, pref stock US Gov. Securities Munis Investment Companies (mutual funds, etfs, cefs) Federal Private Placement (sale qualified purchasers)