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Know Your Customer

Know Your Customer. FINRA Suitability Highlights. l New rule takes effect July 9, 2012. l Must be completed annually by December 31 of each year. This will be a part of your Branch Office audit. Customer Reviews can be in person or via mail.

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Know Your Customer

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  1. Know Your Customer

  2. FINRA Suitability Highlights • l New rule takes effect July 9, 2012. • l Must be completed annually by December 31 of each year. • This will be a part of your Branch Office audit. • Customer Reviews can be in person or via mail.

  3. Know Your Customer forms are available online at www.worldcapitalbrokerage.com in the secure section of the website.

  4. Identifiers go across the top of the page. l Customer Name lAccount NumberlDate

  5. Left column contains basic suitability FINRA requirements. • **Note that worth and income are approximated values. • l Net Worth • Annual Income • Tax Bracket • Risk • Etc.

  6. Flow Chart contains FINRA Know Your Customer and Suitability issues. • l Risk Profile • Time Horizon • Liquidity • Financial Needs • Performance

  7. In order to fully understand your client’s investing needs, knowing exactly where your customer has their monies is critical. **Note all values are approximated. Does this information match their risk tolerance? Could their assets be better invested in other areas? Do they have unused funds?

  8. What investments are in your customer’s portfolio? If the investment has been held less then one year list that information also. For example; “Since February 5, 2012”. Are these investments performing as expected? Does it make sense to move their investment to another area, fund, annuity, etc.?

  9. For those clients you meet face to face. Do not forget to include copies of their performance as well as a copy of their application. This is not a statement unless it shows performance figures. Make sure you keep copies of everything for your files. If any of their suitability or personal information changes and are material we will need a new application sent to the home office. Alternatively have the client sign the flow chart and send a copy into the home office.

  10. For those clients you DO NOT meet face to face. Please refer to our Neg Consent Letter found on our web site below the Flow Chart. If the client calls with questions please fill out a flow chart. Send the Neg Consent Letter to each client along with the performance of their investments and a copy of their application. Makes sure any material changes are reported to the home office by filing out a new account application, by having the clients write us a letter or by sending us a flow chart signed by the client.Make sure you keep copies of everything for your files including a receipt from the post office showing you completed the mailing. For example, a list of customers you mailed to along with a receipt from the post office. Number of customers on your list x cost of a stamp = total amount paid on the receipt. If the customer reports that any of their suitability or personal information has changed, make sure you send those changes to the home office.

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