Although the NASD's continuing education program was just toughened up in July, Merrill Lynch's director of regulatory policy doesn't think it goes far enough. Addressing a crowd of about 200 compliance and training directors at the SIA's continuing education symposium in New York on Sept. 25, Merrill Lynch's O. Ray Vass called for even tougher requirements in broker education. Specifically, Vass proposed implementing minimum training requirements for all reps under the so-called "firm element" portion of the continuing education program.
"Perhaps the industry isn't ready yet, but I have come to believe that the time will come [for] a reasonable minimum [number of credit hours] to increase the credibility of the program," Vass said. Mandated credit hours are necessary "to ensure that every covered individual participates to some minimum degree."
The industry's continuing education program was developed more than four years ago by the Securities Industry Regulatory Council on Continuing Education, made up of representatives from six SROs and nine other industry groups. Under the firm element of training, securities firms are required to conduct an annual assessment of their training needs and implement an internal training program based on that analysis. No specific number of credit hours are required for the firm portion.
Vass said that implementing the firm element without minimum requirements was just an initial step needed to ease firms into the education program. But the program has since expanded. In July, for example, grandfathering of (clean) veteran reps was restricted to those registered 10 years or more as of July 1, 1998. All others will be required to continue taking the regulatory training, even after reaching their 10-year anniversaries.
Training for supervisors was also added in July. Attendees at the symposium were shown the first public demonstration of the new supervisor's program--a 2.5-hour multimedia course expected to roll out this fall.