18.3.3. Conditions of Individual Registration
Once a person files a Form U4 with FINRA, she is registered into FINRA’s Central Registration Depository (CRD), but the registration does not become valid until the person passes the appropriate qualification exam.
Failure to pass. If a person fails an exam, 30 days must elapse before it can be taken again. If a person fails three times in succession, an additional 180 days must pass before the exam may be taken again.
Verification by principal. Before signing a Form U4 for submission, a principal must verify the applicant’s employment for the prior three years and attest to the character and reputation of the applicant.
License and jurisdictional retention. If a registered person leaves the industry and returns within two years, that person’s licenses remain valid. If his return occurs after two years, the person must requalify by passing the appropriate exam.
FINRA’s Maintaining Qualifications Program (MQP) allows a registered individual leaving the industry to extend the period during which they can return to the industry without retaking their exams—up to five years instead of the usual two. An individual who is enrolled in the MQP must complete annual continuing education, consisting of a regulatory element and a practical element, in order to be eligible for the extended five-year grace period. The regulatory element deals with current issues and regulatory concerns specific to a registration category. The practical element covers products, services, and strategies specific to a securities-industry job category. If an individual wishes to enroll in the MQP, they must do so within two years of their termination date. An individual may not enroll in the MQP if they were subject to a statutory disqualification or were registered for less than one year.
If an individual leaving the industry does not enroll in the MQP, they must retake their exams upon returning to the industry after two y