New Rule 3110

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Sep 22, 2014 9:38 am

I worked at Edward Jones for 13 years, and went independent last fall, with the idea that I would keep a main office in my home town and open another office out of state near my wife's home town.  I planned to be the only producer.  I wanted to keep my original office near my old EJ office and have it function as closely as possible to how it did before the move, but only have to be there one week out of each month to meet with clients as needed, as most of my work is done over the phone ( I was assured by the indy recruiter that I could do this, by the way).  The "new" office would serve as a place from which to conduct phone business while I complete the transition from my old firm, and also a place to meet with clients in the new state once I have time to concentrate on building business there.  I did not plan on staffing the new office, at least for a while.



I have run into several problems along the way: one, Compliance says my OSJ must be in my resident state, so OSJ will have to be in the new office's state once my residency changes.  As I understand it, this will create some problems for my plan, such as having to transfer all files to the new office, as well as have all deposits go through there and have all statements sent from that address.  Since my office admin is in the hometown office, this change would be less than idea, as it would transfer some of her administrative duties to me.



The second big problem is that the new FINRA rule 3110 coming out on Dec. 1 is requiring (according to my compliance department) that every office that is staffed have a licensed supervisor on site.  I am being told that I must either hire an FA for my hometown office (which now has only office admin), get my office admin licensed, or shut down the office.  I don't want to hire an FA, as I only plan to be in that office for one week a month, and there's no one I trust that much, and it opens up a whole new realm of potential problems I would like to not have to deal with.  Compliance is telling me the license would have to be a Series 7 for the office admin, not a Series 11.  She is willing to consider the 11, but is very reluctant to commit to getting a 7, which I totally understand.  As she would then basically be an FA, I don't see how option 2 would be different from option 1. 



It seems to me that my compliance dept is interpreting rule 3110 that to me seems to have been written/updated to have better control over offices that have multiple producing reps--not offices that only have one office administrator.  Maybe I'm wrong here.   I have called FINRA for guidance on this.  I thought I would also see if I could cull some fresh perspectives from the community here.



Thanks for your time and consideration.  Apologies for the lengthy email--this has become more complicated than I had imagined.