Business Continuity Plans

As of  September 11, 2004,  all broker/dealers were required to have a Business Continuity Plan in place for their firm. These plans are designed to help firms plan for Significant Business Disruption and to provide investor with information on accessing their holdings should something happen to the broker/dealer.  Firms who do no retail business or are “introducing” must have a plan in place to address the various areas outlined in Rule 3510.  If some required information does not apply, you must include them and state why they are not applicable to your firm.

Most firms have these plans in place but have not looked at them since they were created. However, Rule 3510 requires that broker/dealers review their plans at least annually and update them, if needed, to address changes in their business, location, clearing arrangements or record retention and back-up procedures. Have you looked at your firm's plan lately? If not, now is the time to dust off the binder and take a look to see if the information is still current.

Also, firms must provide a disclosure statement regarding the plan to their clients. If the firm has a website, this disclosure must be posted. If not, you need to decide how it will be delivered and make sure that it is. Many firms send this statement with their annual privacy notices, with statements or with account record update requests but they can also be sent in a separate mailing.

Keep in mind that the individuals identified in your plan as your Business Continuity Plan contacts must match the individuals reported on the NASD Contact System.

Regulatory Compliance has a plan that can be customized to your firm’s business needs. If you don’t have a plan or are not sure if the one you have is adequate to meet the requirements of the Rules, give us a call.

If you have our BCP manual, your Customer Disclosure Statement is provided as the last two pages. You can copy, scan or print these pages to send to your clients and/or post on your website. If you need assistance in updating your manual, please let us know.

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