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Public Protection Cabinet

Broker-Dealers and Agents

Broker-Dealer Registration 
 
Broker-dealers are entities that are licensed to buy or sell securities for investors in the state of Kentucky. An entity with no office and no agent located in Kentucky may handle up to 15 transactions, purchases or sales for Kentucky investors without registration.

To initially register as a broker-dealer in Kentucky, a firm must:

Submit a Form BD - Uniform Application for Broker-Dealer Registration and $120 filing fee to the Central Registration Depository (CRD). A registered broker-dealer must have at least one agent registered in Kentucky. 

A broker-dealer shall promptly file an amendment with the CRD if the information contained in its Form BD becomes inaccurate or incomplete in any material respect. 
To renew a registration, a broker-dealer shall submit a fee of $120 to the CRD. 

To terminate a broker-dealer registration, a firm should file a Form BDW - Uniform Request for Broker-Dealer Withdrawal through the CRD system.

NOTE:  Any Broker-Dealer (BD) that is also an Investment Adviser (IA) or "covered adviser" must either register as an IA under KRS 292.330 or notice file as a "covered adviser" under KRS 292.332. There is no longer a registered BD exemption from the registration or notice filing requirements for investment advisers.

NOTE: Broker-dealers are not required to submit annual reports to the Department of Financial Institutions (DFI).

For more information, contact Ronda Paul at 502-573-3390, ext. 274 with any questions regarding broker-dealer registration requirements. Contact Anna Dennis at 502-573-3390, ext. 284 with any questions regarding compliance issues.



Broker-Dealer Agent Registration 

Broker-dealer agents are individuals who are licensed to sell securities on behalf of a registered broker-dealer.

It is unlawful for a broker-dealer to employ an agent in Kentucky unless that person is registered under the provisions of Kentucky Revised Statutes (KRS) 292.330.

All agent applications, whether initial or transfer, shall be submitted on Form U-4 - Uniform Application for Securities Industry Registration or Transfer to the CRD system along with a $50 registration fee and a checkmark for Kentucky under the "Jurisdictions" section of the form. 

The transfer fee of $50 per agent shall be charged for mass transfers unless waived for good cause shown. Any request for such a waiver shall be in writing addressed to the DFI commissioner and submitted at least 30 days prior to the scheduled transfer.

The renewal fee is $50 per agent, which is paid through the CRD system.

Dual approval is required if the broker-dealer agent is to be an agent for two firms. Refer to 808 KAR 10:030, Section 6. A sample letter will be provided if requested. 

To terminate an agent registration, file a Form U-5 with the CRD within a reasonable period of time (not to exceed 30 days) after the termination of employment.

Broker-dealer agents are required to pass either the Series 63 or 66 examination in addition to the applicable Financial Industry Regulatory Authority (FINRA) exam(s). Enrollment and study materials for these exams may be obtained by calling FINRA at 301-590-6500.

NOTE: Effective Jan. 1, 2010, the new passing scores for each securities law exam will be as follows:

 

Test
Raw Score
Percentage of Test Points
Series 63
43
72%
Series 66
75
75%

 

For more information, contact Lisa Watkins at 502-573-3390, ext. 224 with any questions regarding broker-dealer agent registration requirements.

Policy Statement

Please note that an order or advisory opinion may have changed license or registration requirements. Find out more in the Advisory Opinions, Orders and Notices section on DFI's Statutes and Regulations page.

Disclaimer

The Division of Securities does not respond to requests for written opinions on an “informal” basis such as emails. The Kentucky Securities Act, KRS Chapter 292, sets out a formal process for obtaining written rulings that requires a letter filing (along with a fee of $250) containing all of the relevant facts and circumstances of the proposed transaction(s) so that a thorough consideration of all the issues presented can be made, and to ensure that the provisions of the act are consistently applied. See KRS 292.420(2).

 

 Weblinks to Documents

 
  
  
Form BD - Uniform Application for Broker-Dealer Registrationhttp://www.sec.gov/about/forms/secforms.htm#bdreg
Form BDW - Uniform Request for Broker-Dealer Withdrawalhttp://www.sec.gov/about/forms/secforms.htm#bdreg
Form U-4 - Uniform Application for Securities Industry Registration or Transferhttp://www.finra.org/Industry/Compliance/Registration/CRD/FilingGuidance/P005235
Form U-5http://www.finra.org/Industry/Compliance/Registration/CRD/FilingGuidance/P005235