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Industry Spotlight > Advisors

Don't Forget This CE Requirement, FINRA Warns

By Melanie Waddell

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The Financial Industry Regulatory Authority is reminding broker-dealers and their registered representatives of the need to complete the Regulatory Element of FINRA’s continuing education requirements by Dec. 31; if not, these individuals will be designated “CE inactive.”

Last November, FINRA adopted changes to its CE and registration rules, which stipulates that  individuals registered with FINRA must complete continuing education requirements each year instead of every three years.

As part of the overhaul, changes relating to the Regulatory Element, Firm Element and the two-year qualification period, became effective on Jan. 1, 2023. Beginning Jan. 1, FINRA Rule 1240 (Continuing Education) requires all registered persons to complete the Regulatory Element annually by Dec. 31.

The amended rule also includes changes to the provisions relating to CE inactive status. ”Specifically, registered persons who fail to complete their Regulatory Element within the prescribed annual deadline of Dec. 31 will be automatically designated as CE inactive by FINRA,” according to a FINRA notice.

An individual designated CE inactive, according to FINRA, “is prohibited from performing, or receiving compensation for, any activities requiring registration while they remain in a CE inactive status.”

Those designated as CE inactive “must complete all their required annual Regulatory Element learning plans, including any annual Regulatory Element that becomes due during their CE inactive period, for the CE inactive designation to be removed,” FINRA’s notice states.

If a rep has a CE inactive status for a two-year period, “the individual’s registration(s) will be administratively terminated by FINRA, and the individual will be required to requalify by taking and passing an appropriate examination or by obtaining an examination waiver to re-register with a member firm,” FINRA states.

(Image: Adobe Stock)

Melanie Waddell

@Think_MelanieW

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