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Question: We have an agreement with a reputable broker/dealer to provide an investment center on bank premises. The sales staff is properly licensed. Does the bank have to obtain a securities license?
Answer: No. Regulation R, which was just adopted by the Fed and the SEC, continues the networking exception. CLICK HERE to read the rule. Notice that the rule sets very clear parameters for the "nominal" payments to bank employees who make referrals to the investment center. The amount can be $25, twice the average hourly rate for employees in the class of employee, or a fraction of annual salary (as specified in the rule).
The State Securities Board has a rule requiring the bank to register (but not to obtain a license). The objective is really to just know which banks (and where) have these networking centers. CLICK HERE for the state rule.
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