Introduction
In response to the financial crisis of 2008, Congress passed the Dodd-Frank Act, which, among other things, required “municipal advisors” to register with the Securities and Exchange Commission. The new law required the Municipal Securities Rulemaking Board (MSRB), the municipal securities self-regulatory organization, to create a new registration category called a “municipal advisor principal.” A municipal advisor principal is an employee of a municipal advisor who is directly engaged in the management, direction or supervision of municipal advisory activities and the firm’s associated persons.
To qualify these principals, the MSRB created a new securities qualification exam called the Municipal Advisor Principal Qualification Exam (Series 54).
Once you’ve passed the Series 54 exam, you are qualified to supervise associates who conduct municipal advisory business. You may need to manage individuals who work in multiple capacities relating to municipal entities. A key reason securities licensing exams exist is to make sure that securities professionals know and follow the rules. The rules are a big part of the Series 54, for sure. But becoming registered in the Municipal Advisor Principal Qualification category is about more than learning to play by the rules; it means you are expected to be competent in your supervisory role. For that reason, passing the Series 54 is not easy; it requires you to study and master a wide range of municipal advisory knowledge. The Series 54 Examination is a high bar, but once you’ve hurdled it, you will be more prepared for your new managerial role.
Why do I have to take the Series 54?
The good people at the MSRB follow the same playbook as their cousins at FINRA: municipal advisors must designate principals to supervise municipal advisory activities and associated persons. These individuals are responsible for establishing and enforcing compliance procedures at the firm. If supervisory p