Master the Continuing Education (CE) for the SIE Exam

Continuing Education (CE) is a critical aspect of maintaining competence in the securities industry. Understanding CE requirements is crucial for any aspiring investment company and variable contracts products representative. This chapter focuses on the SRO Regulatory Requirements for Associated Persons, specifically the Chapter 18: SRO Regulatory Requirements for Associated Persons, Part IV: Overview of the Regulatory Framework, with a spotlight on the Firm Element and Regulatory Element CE requirements.

Detailed Explanations

Firm Element

The Firm Element consists of annual training programs designed to enhance the securities knowledge of registered representatives. This education component is tailored by FINRA member firms to address their specific business activities and needs.

• Purpose: To ensure that professionals understand relevant compliance issues, product knowledge, and professional conduct, ultimately safeguarding the investors’ interests.
• Requirements: Firms are required to annually conduct a needs analysis and deliver a training program that caters to these evaluated needs. Each firm must document the training delivered and attended.

Regulatory Element

The Regulatory Element is an online training program that emphasizes securities regulations and ethical business conduct. It’s mandatory for registered representatives and must be completed periodically throughout one’s career.

• Frequency: This element is typically required every three years and focuses on regulatory implications and updates.
• Content: The program is developed by FINRA and the content is uniform across the industry, with scenarios typically involving compliance, ethical considerations, and industry issues.

Combining Elements

While the Firm Element is tailored by individual firms, the Regulatory Element is standardized. Together, they form a comprehensive CE program necessary for maintaining proficiency in the securities industry.

Examples

Example of a Firm Element Requirement: A brokerage firm dealing with a significant amount of municipal bonds might emphasize Municipal Securities Rulemaking Board (MSRB) rules in their annual training.

Example of a Regulatory Element Requirement: A representative who is three years into their role at a brokerage firm must complete a FINRA-designed course focusing on the latest regulations affecting their specific securities arrangement.

Visual Aids

    graph TD;
	    A[Continuing Education - CE] --> B[Firm Element];
	    A --> C[Regulatory Element];
	    B --> D[Annual Needs Analysis];
	    C --> E[Periodical Online Training];

Summary Points

• Firm Element: Customized training provided by member firms annually.
• Regulatory Element: Standard online training mandated every three years.
• The combination ensures comprehensive and up-to-date securities industry knowledge.

Glossary

Firm Element: Firm-specific training to address unique business activities and industry trends.

Regulatory Element: A standardized FINRA-prescribed curriculum for compliance and ethics in business practices.

Additional Resources

• Books:

  • “Securities Industry Essentials Exam for Dummies” by Steven M. Rice
  • “Investments: Analysis and Management” by Charles P. Jones and Gerald M. Jensen

• Online Resources:

  • FINRA website (www.finra.org)
  • Securities and Exchange Commission (SEC) website (www.sec.gov)

• Websites:

  • FINRA Continuing Education Program