Requirements for Opening Customer Accounts

What this video covers

• What the customer-account-information rule requires for every account, and how the trusted contact person (TCP) differs from someone holding power of attorney (POA)
• Why the TCP is optional for the customer but the written TCP disclosure is mandatory for the firm, and why the TCP has zero trading authority
• The three independent paths to institutional account status, and why only the third path carries the $50 million total assets size test
• What information must appear on the new account form before the first trade, versus the three items that need only be obtained by settlement of the first transaction
• Why the customer does not sign the new account form, but the accepting principal must; what the registered representative (RR) recordkeeping actually requires
• The 30-day and 36-month delivery cycles for account records, and why name or address changes trigger a new 30-day notice sent to the old address
• Why express written authorization is mandatory before any firm can draft a customer's bank account, how a signed check itself satisfies this, and the three-year retention rule for separate bank authorizations after expiration