2010 BROKER DEALER

COORDINATED EXAM REPORT FORM

STATE: EXAM NUMBER:

# OF ACCOUNTS: # OF ASSOCIATED PERSONS:

Home Office / Branch Office / Non-Branch Location

ENTITY TYPE

Please use TAB key and mark each area in which a review was conducted. For each item within the topic area, place an “X” in the first column titled “Within Scope” to indicate whether this topic area was reviewed during the examination. If Deficiencies or Violations were noted in that topic area, also place an “X” in the second column for Deficiencies / Violations titled “D / V Noted”. For example, if unauthorized trading was reviewed during the examination but no violations or deficiencies were note, you would check only “Within Scope”. However, if the review of order tickets was included as part of your review and deficiencies/violations were found you would check both the “Within Scope” and “D / V Noted” boxes.

Books and Records

Within Scope / D / V Noted / Within Scope / D / V Noted
Maintenance of Customer New Acct Info / Providing customers a copy of agreements

Providing customers a copy of New Account Card or like facsimile

/ Providing customers with name(s) and address(es) for returning inaccurate new account cards to firm rather than the RR’s

Providing ‘Plain English’ definitions of investment objectives.

/ Evidence of supervisory approval on Customer Account Card

Confirmations

/ Order Tickets

Customer Statements

/ Complaints / Arbitrations / Litigation

Exception reports

/ Advertising / Sales Literature

Electronic Correspondence

/ Purchases & Sales Blotter

Outgoing / Incoming Correspondence

Variable Product Suitability / Mutual Fund Switching

Variable Annuity 1035 Exchanges

/ Unauthorized Trades

Excessive Trading / Churning

/ Sale of Unregistered Securities

Conversion, Misappropriation, or Misuse of Customer Funds

/ Fraudulent or Manipulative Sales Activity
Outside Business Activity / Selling Away

Sales Practices

Within Scope / D / V Noted / Within Scope / D / V Noted

Suitability

/ Mutual Fund Breakpoints
Variable Product Suitability / Mutual Fund Switching

Variable Annuity 1035 Exchanges

/ Unauthorized Trades

Excessive Trading / Churning

/ Sale of Unregistered Securities

Conversion, Misappropriation, or Misuse of Customer Funds

/ Fraudulent or Manipulative Sales Activity
Order ticket does not reflect actual person who took order (i.e. sales assistant) / Sales seminars (Approval to hold / advertising / actual presentation)
Outside Business Activity / Selling Away

Financial Statements / Net Capital

/ Options

Order Room Activity

/ Margin

Handling of Money and Securities

/ Market Making

Anti-Money Laundering

/ Penny Stocks

Currency Transaction Reports (CTR’s)

/ Discretion & 3rd Party Accounts

Reg-T extensions

/ Privacy / Regulation S-P

Trade Cancels & Corrects

/ Active Account Letters

Commission Agreements and Statements

/ Prospectus Delivery

Cold Calling and Telemarketing

/ Sales Seminas

Suitability

/ Mutual Fund Breakpoints
Variable Product Suitability / Mutual Fund Switching

Variable Annuity 1035 Exchanges

/ Unauthorized Trades

Excessive Trading / Churning

/ Sale of Unregistered Securities

Conversion, Misappropriation, or Misuse of Customer Funds

/ Fraudulent or Manipulative Sales Activity
Outside Business Activity / Selling Away
Written Supervisory Procedures -maintain current written procedures / Written Supervisory Procedures – designation of principals in key areas
Written Supervisory Procedures - establish and maintain adequate written procedures. / Written Supervisory Procedures – designation of person responsible for review of the firm’s supervisory system, procedures, and inspections

Following Supervisory Procedures

/ Supervisory/Compliance Manuals - policy/procedures manuals not made available to RR’s & support personnel
Branch Manager Approving own trades / Written Supervisory Procedures - assign each RR to a qualified supervisor
Internal Audits – OSJ branches / Internal Audits – non OSJ branches
Annual Compliance Meetings / Hiring Procedures

Continuing Education – Regulatory Element

/ Continuing Education – Firm Element

Operations Review

Within Scope / D / V Noted / Within Scope / D / V Noted

Financial Statements / Net Capital

/ Options

Order Room Activity

/ Margin

Handling of Money and Securities

/ Market Making

Cold Calling and Telemarketing

/ Penny Stocks

Currency Transaction Reports (CTR’s)

/ Discretion & 3rd Party Accounts

Reg-T extensions

/ Privacy / Regulation S-P

Trade Cancels & Corrects

/ Active Account Letters

Commission Agreements and Statements

/ Prospectus Delivery

Financial Statements / Net Capital

/ Options

Order Room Activity

/ Margin

Handling of Money and Securities

/ Market Making

Anti-Money Laundering

/ Penny Stocks

Currency Transaction Reports (CTR’s)

/ Discretion & 3rd Party Accounts

Reg-T extensions

/ Privacy / Regulation S-P

Trade Cancels & Corrects

/ Active Account Letters

Commission Agreements and Statements

/ Prospectus Delivery

Cold Calling and Telemarketing

/ Sales Seminars


Supervision

Within Scope / D / V Noted / Within Scope / D / V Noted
Written Supervisory Procedures -maintain current written procedures / Written Supervisory Procedures – designation of principals in key areas
Written Supervisory Procedures - establish and maintain adequate written procedures. / Written Supervisory Procedures – designation of person responsible for review of the firm’s supervisory system, procedures, and inspections

Following Supervisory Procedures

/ Supervisory/Compliance Manuals - policy/procedures manuals not made available to RR’s & support personnel
Branch Manager Approving own trades / Written Supervisory Procedures - assign each RR to a qualified supervisor
Internal Audits – OSJ branches / Internal Audits – non OSJ branches
Annual Compliance Meetings / Hiring Procedures

Continuing Education – Regulatory Element

/ Continuing Education – Firm Element

Anti-Money Laundering

/ Use of Professional Designations

REGISTRATION

Within Scope / D / V Noted / Within Scope / D / V Noted

Accurate Form BD

/ Form BR (Branch Offices)
Information on Form U-4 / Qualifications and Licensing
Special or Heightened Supervision / Form U-5 Terminations

Accurate Form BD

/ Form BR (Branch Offices)
Information on Form U-4 / Qualifications and Licensing
Special or Heightened Supervision / Form U-5 Terminations

COMMENTS (please identify topic area heading and item name)

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______(use back of page for additional comments)

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