Notice to Members 05-40

NASD Requests Comment on Proposal to Prohibit All Product-Specific Sales Contests and to Apply Non-Cash Compensation Rules to Sales of All Securities

Comment Period Expired August 5, 2005

NASD currently restricts the payment and acceptance of non-cash compensation in connection with the sale of direct participation programs (DPPs), variable insurance contracts, investment company securities, and public offerings of real estate investment trusts (REITs) and other securities. NASD also prohibits internal non-cash sales contests in connection with the sale of variable insurance contracts or investment company securities unless they meet certain criteria, including that such contests are based on principles of total production and equal weighting. NASD proposes to expand the prohibitions of non-cash compensation to the sale and distribution of any security or type of security, rather than just those enumerated above. NASD also proposes to prohibit all product-specific cash and non-cash "sales contests" as defined by the proposed rule.

Questions concerning this Notice may be directed to Thomas M. Selman, Senior Vice President, Investment Companies/Corporate Financing, at (240) 386-4533; Joseph P. Savage, Associate Vice President, Investment Companies Regulation, at (240) 386-4534; or Philip A. Shaikun, Associate General Counsel, Office of General Counsel, Regulatory Policy and Oversight, at (202) 728-8451.

The views, expressions, findings and opinions expressed in the comments on this Web page are solely those of the author(s) and FINRA accepts no responsibility for the content of the comments: 
DateCommenterFormat - Size
5/10/2005Carty & Company, Inc.PDF - 43.12 KB
8/3/2005AXA Advisors, LLC and AXA Distributors, LLCPDF - 1.03 MB
8/5/2005The Massachusetts Securities DivisionPDF - 185.34 KB
8/5/2005Investment Company InstitutePDF - 334 KB
8/5/2005Massachusetts Mutual Life Insurance Company and MML Investors Services, Inc.PDF - 341.72 KB
8/5/2005Coastal SecuritiesPDF - 70.16 KB
8/12/2005Hines Real Estate Securities, Inc.PDF - 67.58 KB
8/22/2005ProEquities, Inc.PDF - 216.36 KB
8/12/2005American Council of Life InvestorsPDF - 58.46 KB
8/5/2005American Family Securities, LLCPDF - 259.26 KB
7/18/2005United Securities Alliance, Inc.PDF - 29.62 KB
8/5/20051st Global Capital Corp.PDF - 264.01 KB
8/8/2005M Holdings Securities, Inc.PDF - 41.05 KB
8/5/2005Contemporary Financial SolutionsPDF - 41.37 KB
8/5/2005ING AmericasPDF - 4.14 MB
8/5/2005Securian Financial Services, Inc.PDF - 87.81 KB
8/5/2005Securities Industry AssociationPDF - 857.96 KB
8/5/2005Richard M. HewittPDF - 108.84 KB
8/5/2005T. Rowe Price Investment Services, Inc.PDF - 220.9 KB
8/5/2005Financial Services InstitutePDF - 172.75 KB
8/4/2005Transamerica Financial Advisors, Inc.PDF - 69.63 KB
8/4/2005National Society of Compliance ProfessionalsPDF - 13.83 KB
8/4/2005ING Advisors NetworkPDF - 124.18 KB
8/4/2005Pacific Select Distributors, Inc.PDF - 106.15 KB
8/4/2005Pace Investor Rights Project, Pace University School of LawPDF - 113.41 KB
8/4/2005Dominion Investor Services, Inc.PDF - 33.82 KB
7/19/2005Interactive Planning Corp.PDF - 29.76 KB
6/24/2005Mutual Trust Co. of America SecuritiesPDF - 33.61 KB