Requirements for Opening Customer Accounts
Chapters in this video
- 0:00 The signature trap that eats Series 7 candidates
- 1:04 Baseline customer account information Riley must collect
- 1:55 Trusted contact person: not required, age 18, no trading authority
- 3:14 New account form signatures and the 30-day copy rule
- 4:14 Express written authorization for bank account access
- 5:18 Three years after expiration, not transaction date
- 6:07 Rapid-fire exam recap
What this video covers
- What information must be collected on every customer account, including legal age, residence, and the associated person responsible
- Why the trusted contact person (TCP) is NOT required, what "reasonable effort" means, and the age-18 minimum
- What a TCP can do (confirm contact info, flag financial exploitation) versus what they cannot do (trade, act as power of attorney)
- Who signs the new account form: the registered representative (RR) and a principal must sign, the customer does not
- The 30-day rule for sending the customer a copy of the account record at opening and after any change
- Why express written authorization is required to draw on a customer's bank account, and why a signature on the check itself satisfies that requirement
- The 3-year retention rule for negotiable instrument authorizations, measured from when the authorization expires (not the transaction date)
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