Agent

Last updated Dec 10, 2022 Edit Source

• Market participants
• Securities professionals

Agents represent the Issuer or Broker-Dealer (BD) in the purchase and sale of (or attempted purchase and sale of) securities with the public.

An agent (also known as a “registered representative”) may only be an individual (natural person).

• their home state
• their state of employment
• the state of residence of their customers

• They represent the Issuer or Broker-Dealer (BD) in an underwriting transaction
• They represent a bank of a savings and loan in the issuance of securities
• They represent exempt Issuers
• They are exempt or excluded (see below)

Incomplete information

A list of conditions which make an issuer or transaction exempt is not available on this site. Please consult an updated textbook for the most up-to-date list

Who is excluded from the definition of an Agent?

• Clerical and administrative employees of a BD are excluded
• When representing issuers in…
  • effecting transactions in exempt securities
  • effecting exempt transactions
  • transactions with existing employees, partners, or directors of the Issuer, if no sales-related commission/renumeration is paid

Reps of BDs must always register

If the Agent represents a Broker-Dealer (BD) firm, they must always register, no matter what

Which Agents are exempt from registration?

• There is a snowbird exemption for clients residing out of state temporarily (see your textbook for the exact definition)
• An Agent is exempt, if they are working for a firm that is excluded from the Broker-Dealer (BD) definition

No de minimis exemption

Unlike Investment Adviser Representatives (IARs), Agents do not have a de minimis exemption

Agents must use Form U4 to register with the appropriate jurisdictions and/or self-regulatory organizations.