Client Profile
An investment advisor firm sought to grow its business by establishing a broker-dealer arm to sell securities, including mutual funds and annuities. To so, the firm needed to register with FINRA as a Broker Dealer.
The Situation
In coming to us with help for the New Member Application (NMA) Process with FINRA, it was determined that in addition to assistance with the NMA, the firm needed a resource for the FINOP position.
The FINRA registration applications are processed by the MAP division of FINRA. Prospective FINRA member firms must seek approval for new FINRA membership through the submission of a New Membership Application (NMA or Form NMA) in accordance with FINRA Rule 1013.
Firms applying for FINRA membership, with the exception of sole proprietorships, must have at least two registered principals and one Financial and Operations Principal (FINOP). To qualify as a firm’s FINOP, individuals must pass FINRA’s Series 27 or Series 28 qualification examination.
However, not all registered FINOPs have the appropriate experience to do the job effectively. The regulatory rules for broker-dealers are complex. FINOPs must have, in addition to the Series 27 license, enough experience in the industry and knowledge of the inner workings of the firm to understand the nuances and interpretations regulators are expecting.
The firm did not have a qualified FINOP in place and decided to outsource a licensed, experienced FINOP from Oyster Consulting.
The Challenges
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FINRA Registration – Complex NMA process
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FINOP Requirement – No in-house FINOP
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Regulatory Compliance – Net Capital & reporting
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Operational Readiness – Accurate financials
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Ongoing Requirements – Continuous oversight
Actions Taken By Oyster Consulting
As the firm had no employees or Principals with the required licensing and experience, Oyster consulting provided a qualified individual to serve as their FINOP.
Oyster Consulting’s outsourced FINOP became responsible for:
- The maintenance of the member firm’s broker-dealer’s books and records
- The accuracy of the financial statements
- Compliance with applicable Net Capital Rules and Customer Protection Rules
- Timely submission of all financial regulatory reports
- Overall supervision of and responsibility for the individuals who are involved in the administration and maintenance of the firm’s back-office operations.
The Outcome
The firm was successfully registered and Oyster Consulting continued to provide licensed FINOP support, including, but not limited to:
- Reviewing current accounting practices
- Providing net capital compliance and monthly or quarterly FOCUS Reports, as required
- Filing Focus Part IIA monthly or quarterly, as required
- Filing SSOI with FINRA quarterly
- Filing Focus Schedule I annually
- Filing Quarterly Form Custody
- Filing SIPC 6 and 7
- Reviewing audited financial statements annually.

What Our Clients Have to Say
"Oyster's expertise helped us streamline our business model to ensure we are focused on driving revenue and becoming less burdened by outdated policies and procedures."
- Founder, Broker Dealer
"The Oyster team has always shown they have in-depth industry knowledge that has proven to be invaluable to us as a firm, from looking at issues strategically to helping implement efficiencies. We have never been disappointed with their engagements."
- President, National Broker Dealer
“Oyster took away the guess work, providing us with a strategy that led to value.”
- President, National Broker Dealer
"Oyster's expertise helped us streamline our business model to ensure we are focused on driving revenue and becoming less burdened by outdated policies and procedures."
- Founder, Broker Dealer
"The Oyster team has always shown they have in-depth industry knowledge that has proven to be invaluable to us as a firm, from looking at issues strategically to helping implement efficiencies. We have never been disappointed with their engagements."
- President, National Broker Dealer