Financial Services Affiliate Waiver Program (FSAWP)
Pursuant to FINRA Rule 1210.09, FINRA has established a waiver program for eligible individuals who leave a member firm to work for a foreign or domestic financial services affiliate of a member firm with FINRA. Under the FSAWP, such persons would be granted a waiver of their requalification requirements, including the SIE exam, upon reapplying with FINRA within a single, fixed seven-year period, subject to meeting certain conditions as described below. For additional information, refer to Regulatory Notice 17-30.
To be eligible for the program, an individual must meet the following conditions:
- The individual must have been registered as a representative or principal for a total of five years with the most recent 10-year period prior to his or her initial designation under the program, and
- The individual must have been registered as a representative or principal for at least one year prior to their initial designation under the program with the member firm that is requesting the designation.
Requesting FSAWP Designation
The member firm must take the following steps to establish a person’s initial FSAWP designation:
- File the Form U5
The firm must file a Form U5 to terminate the individual’s registration with FINRA. The termination date on the Form U5, not the Form U5 filing date, will be the individual’s initial FSAWP designation date. The termination date must be on or after October 1, 2018.
- Complete the FSAWP Designation Request Form
Within 30 days of termination, as noted on the Form U5 in CRD®, the member firm must complete the FSAWP Designation Request Form and submit it to FINRA via email to [email protected]. Before submitting the form, the member firm must ensure that the individual meets the eligibility criteria, as described above.
- Receive Notification of Designation from FINRA
Within three business days, FINRA will notify the firm and the individual via email of the individual’s FSAWP eligibility status.
- Eligibility Notification: The FSAWP Eligibility Approval Letter states that the request has been reviewed and the applicant is eligible for the FSAWP.
- Ineligibility Notification: The
Individual's Responsibilities While Eligible
Included in the FSAWP Eligibility Notification email will be instructions for the individual to sign up for a Financial Professional Gateway (FinPro) account. To remain FSAWP-eligible while working for a financial services affiliate, the individual must meet the following conditions:
- Complete their appropriate Continuing Education (CE) Regulatory Element (FINRA Rule 1240(a)) as required. The Regulatory Element will be based on the same cycle that the individual would have had if they had remained with the firm. FINRA will notify the individual via email 30 days prior to the start of their CE requirement window. This is the only CE notification that the individual will receive. The individual can also, through their FinPro account, view their initial CE requirement and enroll for a session via the Test Enrollment Services System to take CE Online. The individual will be responsible for paying the Regulatory Element fee.
- Continuously work for a financial services industry affiliate of a member firm. The individual is permitted to move between the financial services affiliate of a member or move from the financial services affiliate of one member to the financial services affiliate of another member. However, any such transfers must be made promptly and within 30 calendar days to remain eligible for the waiver.
- The individual will be responsible for notifying FINRA’s Candidate Services if there is a change to the email address used for the initial eligibility notification. Within three business days, the individual will receive confirmation of the email address update from FINRA.
Requesting a FSAWP Waiver
If a firm decides to associate with and register an individual who is eligible for a waiver under the program, the member firm must submit a Uniform Application for Securities Industry Registration or Transfer (Form U4) electronically via CRD, requesting the appropriate registrations for the individual. The firm must then file a waiver request via Firm Gateway. As part of the waiver request, the firm must state that it is requesting an FSAWP waiver, represent that the individual has satisfied the conditions of the FSAWP, and provide any supporting materials. The Employment History section of the applicant’s Form U4 should be properly updated to document their employment information during the non-associated period. All waiver requests must be made within seven years of the initial FSAWP designation date.
FINRA Review of FSAWP Waiver Requests
Upon receipt of the FSAWP waiver request, FINRA staff will verify:
- the individual’s initial FSAWP designation;
- that the waiver request has been made within seven years of the individual’s initial FSAWP designation;
- that the individual has continuously worked for a financial services industry affiliate of a member firm since their last Form U5 filing;
- that the individual has complied with the Regulatory Element requirement; and
- that the individual does not have any pending or adverse regulatory matters, or terminations, that are reportable on the Form U4 and is not subject to statutory disqualification as defined in Section 3(a)(39) of the Securities Exchange Act of 1934 while eligible under the program.
FINRA will review the waiver request and determine whether to grant the request within 30 calendar days.
Frequently Asked Questions
- 1. Can people who move to an affiliate prior to October 1, 2018, avail themselves of the FSAWP?
- No. The FSAWP becomes available October 1, 2018.
- 2. How long does FSAWP eligibility last?
- Seven years from the date of designation, which is based on the initial Form U5 termination date. Note that each individual can request and establish only one seven-year eligibility per lifetime. Once FSAWP eligibility has been requested and established, the seven-year period will run continuously, even if the individual returns to the member firm and regains their registration via the FSAWP.
- 3. How is the seven-year eligibility period calculated?
- Once an individual is designated FSAWP-eligible, the seven-year eligibility period starts on the date of designation, which is based on the initial Form U5 termination date. For example, if an individual’s Form U5 termination date/designation date is November 1, 2018. The FSAWP waiver request must be submitted no later than October 31, 2025.
- 4. Can I change firms during the seven-year FSAWP eligibility period?
- Yes. During the seven-year period, an individual is permitted to move back and forth between a member firm and its affiliate or move to another member firm. The individual is also permitted to move between the financial services affiliates of a member firm or move from a financial services affiliate of one member firm to the financial services affiliate of another member firm as long as the individual is continuously working for a financial services affiliate of a member firm while designated FSAWP-eligible. Transfers between member firms and their affiliates or other financial services affiliates must be made promptly and within 30 calendar days.
- 5. If I become ineligible for the FSAWP, can my firm still request a regular waiver?
- Yes. If an individual who was previously designated FSAWP-eligible becomes ineligible, the firm is permitted to apply for a waiver under FINRA Rule 1210.03.
- 6. How will I be notified of my CE requirement?
- FINRA will notify FSAWP-eligible individuals of their CE requirements via email 30 days prior to their CE window open date. Individuals can also monitor their initial CE requirement via their Financial Professional Gateway (FinPro) account.
- 7. Will I be notified if I become ineligible during the seven-year period?
- No. FINRA will not be monitoring FSAWP-eligible individuals. If an individual becomes ineligible, FINRA will only become aware of the FSAWP ineligibility at the time the waiver is requested.
- 8) What is a financial services affiliate of a member?
- A financial service affiliate of a member is a legal entity that controls, is controlled by or is under common control with a member and is regulated by the SEC, CFTC, state securities authorities, federal or state banking authorities, state insurance authorities, or substantially equivalent foreign regulatory authorities.
Questions Regarding the FSAWP Waiver Process
Member firms that have questions regarding the FSAWP should call FINRA’s Gateway Call Center at (301) 869-6699.