Stockbrokers, otherwise known as registered representatives, work in a sales capacity for the broker-dealer firms that employ them. Registered representatives working with residents of Arizona must be registered with the Securities and Exchange Commission and the Arizona Corporation Commission, Securities Division before they can solicit clients. This easy to follow guide details Arizona’s registration process in full.
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Step 1. Get Your Education
- The Arizona Corporation Commission, Securities Division does not enforce specific educational standards, but most broker-dealer firms will only consider your application if you’ve earned a four-year degree. In addition, a bachelor’s degree may be necessary if you wish to pursue professional designations during your career.
Registered representatives can benefit from majoring in one of the following areas:
- Business Administration
- Consumer and Family Financial Services
- Business communications
- Business ethics
- Business law
- Behavior of organizations, persons and groups
- Quantitative applications in business
- Accounting, in particular courses in financial accounting and managerial accounting
Step 2: Take the Series 7 Exam to Earn your Securities Representative License
Eligibility to attempt the required exams is dependent on becoming sponsored by a broker-dealer firm already registered in Arizona.
As an Arizona applicant, you must present documentation of lawful presence in the United States. Be sure to read the full regulatory advisory.
- Electronically file registration. Complete Form U-4, Uniform Application for Securities Registration or Transfer. Use Form U-10 Uniform Examination request for non-FINRA Members if your sponsoring firm is not a member of the Financial Industry Regulatory Authority.
Your broker-dealer will assist you in completing the appropriate form and submit it on your behalf through the Central Registration Depository (CRD). This serves as a comprehensive application for SEC and Arizona state registration so must include:
- $85 administrative fee charged by FINRA. Generally, your broker-dealer firm will pay any registration fees for you.
- Registered representatives in Arizona must pass the Series 7 and the Series 63. Exam fees are $265 for the Series 7 and $96 for the Series 63.
- You must also submit fingerprints. If your broker-dealer cannot take your fingerprints, schedule to have them taken at a local police station or sheriff’s office for a nominal fee. FINRA charges of $30.25 as a fingerprint card-processing fee.
- Arizona Corporate Commission, Securities Division maintains a registration fee of $45 to register as a registered representative.
- Once you receive approval, you may register for the Series 7, General Securities Representative Examination.
- The Arizona Securites Division also requires you to pass the Series 63, Uniform Securities Agent State Law Examination.
- Schedule the exam(s) through either a Prometric or Pearson exam location in Arizona within120 days of becoming registered. You will not be allowed to schedule the Series 7 and the Series 63 for the same day.
- Be prepared for your exams. Your broker-dealer may offer you resources either internally or through a third-party provider. Arrive an hour before your scheduled exam. You should receive instructions from the test facilitator as to what you will be required to bring to the testing center.
- You will receive your exam score after completing the test. Upon passing the required exams, you will become a registered representative in Arizona.
Step 3: Get Your On-The-Job Training
You will receive on-the-job training through your broker-dealer as you begin your career. You may job shadow a fellow employee or participate in group sessions. This will give you insight into how your firm operates, its investment philosophy, as well as teach you the basics of securities sales.
Your on-the-job training will likely cover the following security products:
- Variable contracts
- Mutual funds
- Options on stocks
- Corporate, municipal and treasury bonds
- Corporate equity and debt securities
- Government securities
- Open-end and closed-end investment company shares
- Direct participation programs like non-publicly traded real estate investment trusts or oil and gas leases
Step 4: Ongoing Requirements for License Renewal and Continuing Education
- Annual License Renewal and Fees
Your securities license in Arizona must be renewed annually. Arizona charges a $45 renewal fee, which is generally paid by your broker-dealer on your behalf. Renewal fees are submitted to the Arizona Corporate Commission, Securities Division through the Web-CRD (Central Registration Depository).
- Continuing Education Requirements
The Securities Industry Continuing Education Program requires that you complete ongoing continuing education. The Continuing Education Program is made up of two requirements:
- The Regulatory Element
You will be notified through your broker-dealer’s compliance office when the Regulatory Element is due. The first of these continuing education modules will take place within 120 days of your second annual registration. It will only be required once every three years after that.
As a Series 7 licensed registered representative you’ll complete the S101 General Program as the Regulatory Element. The S101 addresses the issues of ethics, sales-practices, and regulatory and compliance standards:
- Client/Product Suitability
- New and Secondary Offering & Corporate Finance
- Communicating with the Public
- Handling Customer Accounts/Trade and Settlement Practices
- The Firm Element
After performing their annual internal evaluation, your broker-dealer will determine which relevant product and industry related training to include in the Firm Element. You’ll be required to complete Firm Element training once yearly, which often focuses on the following areas:
- Sales practices and suitability standards
- Investment features and associated risk factors
- Regulatory requirements related to products, services, and strategies
- The Regulatory Element
- Updating your Form U-4
As a registered representative you are responsible for informing your firm’s compliance department within 30 days of any changes affecting your Form U-4. This includes:
- Address updates
- Changes to name or marital status
- Customer complaints
- Civil judgments against you
- Criminal disclosure
- Pending or completed disciplinary actions
- Financial judgments against you
Potential clients and industry regulators can determine if your registration is current through FINRA’s BrokerCheck.