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- 24 April, 2009 -
- Forex, Legal Resources -
- Tags : branc office manager, branch office manager exam, cftc, CPO, cpo branch office, CTA, cta branch office, Forex, forex hedge fund, hedge fund law, NFA, series 30, series 30 exam
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Overview of Series 30 Exam
The Series 30 exam is a National Futures Association sponsored exam which is required for those persons who are branch office managers of a NFA member firm (see our post on CPO and CTA Branch Office Information). Generally if a NFA Member firm (such as a CPO or CTA) has a branch office (any place of business other than the main office), the firm will need to make sure that a branch office manager is employed at each such branch office.
Exam Specifics
- Branch Manager Examination.
- 50 True/False and Multiple Choice questions.
- One hour long.
- $70.
- 70% correct answers required to pass
Signing up for the Exam
The Series 30, like all of the other exams sponsored by the NFA, is administered by FINRA. Accordingly, an applicant will need to first register to take the exam by completing a FINRA Form U-10. After the U-10 has been completed, submitted and processed, the applicant will be “in the FINRA system” and will be able to sign up for an exam time at either a Prometric or Pearson testing facility. Applicants can determine available times and locations by visiting these websites. The test is generally given a number of times a day, six days a week.
Series 30 Exam Topics
BRANCH MANAGER EXAM—FUTURES
SERIES 30
The following is a general listing of the major subject areas covered by the examination and does not represent an exhaustive list of the actual test questions.
A. General
- Books and records, preparation and retention
- Order tickets, preparation and retention
- Written option procedures
- Handling of customer deposits
- NFA Compliance Rule 2-9, supervision of employees
- Business Continuity and Disaster Recovery Plan
- Registration requirements—who needs to be registered, sponsor verifi cation, NFA Bylaw 1101, AP termination notices, temporary licenses
- NFA disciplinary process
- Reportable positions
- NFA Arbitration Rules
- On-site audits of branch offices
- Bona fide hedging transactions
- Trading on foreign exchanges
B. CPO/CTA General
- Registration requirements
- Books and records to be maintained
- Reports to customers
- Bunched orders
C. CPO/CTA Disclosure Documents
- Management and incentive fees
- Performance records
- How long a CPO or CTA can use a disclosure document
- Conflicts of interest
- Pool units purchased by principals
- Business backgrounds of principals
- Amendments to disclosure documents
- Disclosure of disciplinary actions
- NFA review of document before each use
D. NFA Know Your Customer Rule
- Client information required
- Responsibility to obtain additional client information
- Risk disclosures
E. Disclosure by CPOs and CTAs Required for Costs Associated with Futures Transactions
- Disclosure of upfront fees and expenses
- Effect of upfront fees and organizational expenses on net performance
F. Disclosure by FCMs and IBs Required for Costs Associated with Futures Transactions
- Explanation of fees and charges to customers
G. IB General
- Accepting funds from customers
- Guarantee agreements
- Responsibilities of guarantor FCM
- Minimum net capital requirements
- Time stamping of order tickets
- Books and records to be maintained
H. General Account Handling and Exchange Regulations
- Risk Disclosure Statement
- Margin requirements
- Stop loss orders
- Preparing orders
- Proprietary accounts
- Positions limits and reporting requirements
- Trade confirmations
I. Discretionary Account Regulation
- Requirements relating to discretionary accounts
- Supervision and review of discretionary accounts
J. Promotional Material (Compliance Rule 2-29)
- Definition of promotional material
- Standardized sales presentations
- Use of a third-party consulting or advertising firm
- Reprints of articles from industry publications
- Recordkeeping of promotional material
- Past performance
- Hypothetical trading results
- Written procedures for promotional material
- Supervisory review of promotional material
K. Anti-Money Laundering Requirements
- Developing policies, procedures and internal controls
- Customer identification program and recordkeeping
- Detection and reporting of suspicious activity
- Training staff to monitor trading activity
- Recordkeeping
- Designation of individual or individuals (“compliance officer”) to be responsible for overseeing the program
- Employee training program Independent audit function
Other NFA Information
The NFA also has this to say about the Series 30 exam:
Branch Manager Examination – Futures (Series 30)
NFA must receive evidence that individuals applying to be a branch office manager have passed the Series 30. However, NFA will not require evidence that they have passed the Series 30 if, since the date they last ceased acting as a branch office manager, there has not been a period of two consecutive years during which they have not been registered as an AP. Additionally, individuals whose sponsor is a registered broker-dealer may, in lieu of the Series 30, provide proof that they are qualified to act as a branch office manager or designated supervisor under the rules of FINRA.
Please contact us if you have a question on this issue or if you would like to start a hedge fund, CPO or CTA. If you would like more information, please see our articles on starting a hedge fund. Other related hedge fund law articles include:
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