Form U-5 is a form required by the Financial Industry Regulatory Authority (FINRA) to be filed by member firms when an associated person (AP) leaves their employ. The form is used to report information about the AP, such as their employment history, qualifications, and any disclosures or disciplinary action that took place during their time at the firm.
Form U-5 must be filed within 30 days of the AP’s termination of employment. It is important to note that Form U-5 can be accessed by prospective employers and regulators.
The form includes a series of questions that the firm must answer regarding the AP, such as:
- Basic information about the AP, such as their name, address, and date of birth
- Details of the AP’s employment with the firm, including the dates of their employment and the reasons for their termination
- Information about any licenses or registrations held by the AP
- Disclosures about any customer complaints, arbitration claims, or regulatory actions involving the AP during their time at the firm
- A summary of the AP’s job performance during their time at the firm
- Any other information that the firm believes should be disclosed about the AP.
Form U-5 is very important as it helps the regulators and other firms to understand any potential issues with an AP who has left a firm.
The comments on the Form are extremely important and can have a devasting and lasting impact on the advisor’s work and registration. It is important to negotiate the language when there is an involuntary termination, and an experienced securities attorney can help with that negotiation.
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