MSRB Proposes Expanding Continuing Education Requirements for Muni Dealers
Commentary by Steven Lofchie
The MSRB proposed amendments to Rule G-3 ("Professional Qualification Requirements") to expand and align the MSRB's continuing education ("CE") program requirements with FINRA's recently updated standards. The new requirements will apply to broker-dealers and muni dealers, but not to muni advisors.
The revised MSRB CE requirements would apply to all registered individuals, not just to those that have customer contact or otherwise engage in specified activities such as research.
The amended rule would require fulfillment of the "regulatory element" (which focuses on regulatory requirements and industry standards) each calendar year (rather than every three years). An associated person that does not complete the requirement by December 31 of the current calendar year would be suspended from registration.
The proposal would permit training on AML to satisfy the "firm element" (which focuses on the firm's securities products, services and strategies, its policies and industry trends) CE requirement. The MSRB will consider recognition of external training programs.
The MSRB stated that it will permit an individual who leaves a regulated firm to maintain CE training. An individual who maintains training would be permitted to come back into the industry up to five years later (rather than the current rule of two years later) without retaking examinations.
Commentary
The MSRB provided a description of the proposed changes as well as a reasonably comprehensive overview of CE requirements generally. Given that FINRA also recently amended its CE Rules, this would be a good time for firms to review their CE programs, both as to substance and as to process.