The following glossary of terms is intended only for use by BrokerCheck users to assist them in better understanding a BrokerCheck report. Please note that these terms may have slightly different or more specific meanings in other contexts.
Agent A term used by states to describe a person licensed to engage in the securities business in that state.
Arbitration A method to resolve a dispute where an unbiased person or persons (i.e., a panel of arbitrators) is appointed to hear and consider all sides of the dispute and provide a final and binding decision (referred to as an award).
Arbitrator An independent, neutral person chosen to resolve disputes between parties.
Arbitration Award An arbitrator's final, written decision.
Bond Typically refers to a long-term promissory note in which the issuer agrees to pay the owner a specific interest rate at regular intervals and then pay the face value on a set future date.
Branch Office Any location identified by any means to the public or customers as a location at which a brokerage firm conducts investment banking or securities business. For purposes of BrokerCheck and BrokerCheck reports: (1) any branch office listed is currently active/open for business; (2) a firm may have multiple branch offices; and (3) an investment professional may be located (i.e., conduct business) at more than one branch office.
Broker An individual investment professional who acts as an intermediary between a buyer and seller of securities and who executes such transactions.
Brokerage Firm/Broker-Dealer Firms registered with FINRA or a national securities exchange that act as securities dealers or investment professionals or perform both functions.
Clearing Firm An organization affiliated with exchanges that completes securities transactions by taking care of validation, delivery and settlement. Clearing firms help ensure that executed trades are settled efficiently and within a specified time period. Also called a clearing corporation.
Central Registration Depository (CRD®) An online computerized system in which FINRA maintains the employment, qualification and disciplinary histories of more than 650,000 securities industry professionals and more than 5,000 brokerage firms that deal with the public.
CRD Number A unique number assigned to investment professionals and brokerage firms as part of their registration application with FINRA.
Customer Dispute A consumer-initiated complaint or investment-related arbitration proceeding brought against an investment professional and/or brokerage firm alleging sales practice violations, forgery, theft or misappropriation of funds.
Dealer Any person or company in the business of buying and selling securities for their own account, through an investment professional, brokerage firm or otherwise. (See broker.)
Disclosure Event An occurrence required to be reported as part of the FINRA licensing and registration process for investment professionals and brokerage firms. These events include criminal, regulatory and civil actions, as well as certain financial incidents.
Employment History The information reported by the investment professional on all jobs they have held in the last 10 years both in, and outside of, the securities industry (this may include periods of unemployment and education).
Exams Securities professionals must pass qualifying exams administered by FINRA to demonstrate their competence in the particular securities activities in which they will work. An individual must pass the exams prior to engaging in those areas of the business. The following pages list the exams that might be displayed in BrokerCheck.
Form BD (Uniform Application for Broker-Dealer Registration) Brokerage firms file Form BD to register with the SEC, FINRA, other self-regulatory organizations (SROs), states and/or jurisdictions.
Form BDW (Uniform Request for Broker-Dealer Withdrawal) Brokerage firms file Form BDW to withdraw their registrations with the SEC, FINRA, other self-regulatory organizations (SROs), states and/or jurisdictions.
Form U4 (Uniform Application for Securities Registration or Transfer) Brokerage firms file Form U4 to register their investment professionals with FINRA, other self-regulatory organizations (SROs), states and/or jurisdictions.
Form U5 (Uniform Termination Notice for Security Industry Registration) Brokerage firms file Form U5 to terminate an investment professional's registration with FINRA, other self-regulatory organizations (SROs), states and/or jurisdictions.
Form U6 (The Uniform Disciplinary Action Reporting Form) Regulators, states and/or jurisdictions use this form to report disciplinary actions against an investment professional or firm. FINRA uses Form U6 to report final arbitration awards against investment professionals and firms.
Inactive A status indicating that a firm or investment professional does not currently have an effective registration. An inactive status typically results when a firm or investment professional has not completed a registration requirement (e.g., an investment professional has not completed a continuing education requirement or an applicant for registration has failed to submit a fingerprint card within the required time period).
Indirect Owner A person who has the power to indirectly influence the management or policies of a brokerage firm, whether through ownership of securities, by contract or otherwise.
Introducing Firm A brokerage firm that can perform all of the functions of an investment professional except accept money, securities or property from a customer.
Investment Adviser Public Disclosure (IAPD) Website A website sponsored by the Securities and Exchange Commission that provides public users access to registration and disclosure information about investment adviser firms and investment adviser representatives.
Municipal Securities Broker An investment professional engaged in the business of effecting transactions in municipal securities for the account of others.
Municipal Securities Dealer Any person (including a separately identifiable department or division of a bank) engaged in the business of buying and selling municipal securities for his own account.
Registration Category A designation of the type of work an investment professional or brokerage firm is registered or licensed to perform. For example, registration categories for an investment professional can include General Securities Representative or Principal.
SEC Number A unique identification number assigned to a firm by the Securities and Exchange Commission.
Self-Regulatory Organization (SRO) An entity, such as FINRA, responsible for regulating its members by adopting and enforcing rules that govern its members' business conduct.
Succession History A brokerage firm's record of the acquisition, ownership and right to manage another firm's assets and liabilities.
Suspended A status indicating that a firm or an investment professional has been precluded from engaging in the investment banking or securities business generally or from engaging in a particular function (e.g., supervising others), usually as a result of a regulatory action.
U.S. Government Securities Broker Any person regularly engaged in the business of effecting transactions in government securities for the account of others.
U.S. Government Securities Dealer Any person engaged in the business of buying and selling government securities for their own account through an investment professional or otherwise.