Rule 590-4-5-.06 - Books and Records(1) All broker-dealers and agents who are registered or required to be registered with the SEC or are members of FINRA or any national securities exchange registered with the SEC shall make, keep and preserve such records as the SEC, FINRA, and national securities exchanges registered with the SEC require be made, kept, and preserved. These records shall be subject to inspection by the Commissioner. The records of a broker-dealer and agent registered or required to be registered under the Act are subject to such reasonable periodic or special inspections by a representative of the Commissioner as the Commissioner considers necessary or appropriate in the public interest and for the protection of investors. An inspection may be made at any time and without prior notice. The Commissioner may copy and remove any record the Commissioner reasonably considers necessary or appropriate to conduct the inspection. The fee for a routine examination of a broker-dealer shall be thirty-five (35) dollars per working hour with the total fee not to exceed $1,000.(2) Broker-dealers that are not registered with the SEC or are not members of FINRA or of any national securities exchange registered with the SEC shall make and keep the following records: (a) Blotters (or other records of original entry) containing an itemized daily record of all purchases and sales of securities, all receipts and deliveries of securities (including certificate numbers), all receipts and disbursements of cash and all other debits and credits. These records shall show the account for which each such transaction was effected, the names and amount of securities, the unit and aggregate purchase or sale price (if any), the trade date and the names or other designation of the person(s) from whom, purchased or received or to whom sold or delivered.(b) Ledgers (or other records) reflecting all assets and liabilities, income and expenses and capital accounts.(c) Ledger accounts (or other records) itemizing separately, as to each cash and margin account of every customer and of such broker-dealer and partners thereof, all purchases, sales, receipts, and deliveries of securities for such account and all other debits and credits to such account.(d) Ledgers (or other records) reflecting the following:1. Securities in transfer;2. Dividends and interest received;3. Securities borrowed and securities loaned;4. Money borrowed and money loaned (together with a record of the collateral therefore and any substitutions in such collateral); and5. Securities failed to receive and failed to deliver.(e) A securities record or ledger reflecting separately for each security, as of the clearance dates, all "long" or "short" positions (including securities in safekeeping) carried by such broker-dealer for its account or for the account of its customers or partners showing the location of all securities "long" and the offsetting position to all securities "short" and, in all cases, the name or designation of the account in which each position is carried.(f) A memorandum of each brokerage order and of any other instruction given or received for the purchase or sale of securities whether executed or unexecuted. This memorandum shall show the terms and conditions of the order or instruction and of any modification or cancellation thereof, the account for which the order or instruction was entered, the time of entry, the price at which the order or instruction was executed and, to the extent feasible, the time of execution or cancellation and whether the order was solicited or unsolicited. Orders entered pursuant to the exercise of discretionary power by such broker-dealer, or any associated person thereof, shall be so designated. The term "instruction" shall be deemed to include instructions between partners and associated persons of a broker-dealer. The term "time of entry" shall be deemed to mean the time when such broker-dealer transmits the order or instruction for execution, or, if it is not so transmitted, the time when it was received.(g) A memorandum of each purchase or sale of securities for the account of such broker-dealer showing the price and, to the extent feasible, the time of execution; and, in addition, where such purchase or sale is with a customer other than a broker or dealer, a memorandum of each order received, showing the time of receipt, the terms and conditions of the order, and the account in which it was entered.(h) Copies of confirmations of all purchases and sales of securities and copies of notices of all other debits and credits for securities, cash and other items for the accounts of customers and partners of such broker-dealer.(i) A record in respect of each cash and margin account with such broker-dealer containing the name and address of the beneficial owner of such account and, in the case of a margin account, the signature of such owner; provided, however, that in the case of a joint account or an account of a corporation, limited liability company or partnership, such records are required only in respect of the person or persons authorized to transact business for such account.(j) A record of all puts, calls, spreads, straddles and other options that such broker-dealer has granted or guaranteed containing, at least, an identification of the security and the number of units involved.(k) A record of the proof of money balances of all ledger accounts in the form of trial balances. These trial balances shall be prepared currently at least once a month.(l) An application for employment executed by each "associated person" (as hereinafter defined) of such broker-dealer that is approved in writing by an authorized representative of such broker-dealer and contains at least the following information with respect to such associated person:1. Name, address, social security number and the starting date of employment or other association with the broker-dealer;3. The educational institutions attended and whether the associated person graduated therefrom;4. A complete, consecutively ordered statement of all business connections for at least the preceding seven (7) years, including reason(s) for leaving each prior employment and whether the employment was part-time or full-time;5. A record of any denial of membership or registration and of any disciplinary action taken or sanction imposed upon him or her by any Federal or State agency or any national securities exchange or national securities association, including any finding that he or she was a cause of any disciplinary action or had violated any law;6. A record of any denial, suspension, expulsion or revocation of membership in any national securities association, securities exchange or registration with any state, federal or governmental agency with which he or she was associated in any capacity when such action was taken;7. A record of any permanent or temporary injunction entered against him or her or any member of a national securities association or stock exchange or broker or dealer with which he or she was associated in any capacity at the time such injunction was entered;8. A record of any arrests, indictments or convictions for any felony or any misdemeanor, except minor traffic offenses, of which he or she has been the subject;9. A record of any other name or names by which he or she has been known or has used; and10. A record of all licenses, registrations and memberships related to securities that he or she holds.11. For purposes of Subsection (2)(l) of this Rule, the term "associated person" shall mean a partner, officer, director, agent, trader, manager, any employee or any independent contractor handling funds or securities or soliciting transactions or accounts for such broker-dealer.(3) Broker-dealers not registered with the SEC or not members of FINRA or of any national securities exchange registered with the SEC shall preserve for a period of not less than five (5) years, the first two (2) years in an easily accessible place, the records required to be maintained by Sections (1) or (2) above and the following: (a) All checkbooks, bank statements, cancelled checks and cash reconciliations relating to the business of the broker-dealer;(b) All invoices (or copies thereof) received by the broker-dealer from any other person relating to the business of the broker-dealer, whether the broker-dealer paid the invoice or the invoice is still payable, and, where the broker-dealer has paid the invoice, all records of the payment made;(c) All invoices (or copies thereof) sent by the broker-dealer to any other person relating to the business of the broker-dealer, whether the broker-dealer has received any payment from the other person or any part of the invoice is still receivable, and, where the broker-dealer has received a payment, either in full or in part, on the invoice, all records of the payment received;(d) Originals (maintained in paper or electronic media storage) of all communications received and copies of all written and electronic communications sent by such broker-dealer (including interoffice memoranda and communications) relating to the business of the broker-dealer;(e) All trial balances, financial statements, branch office reconciliations and internal audit working papers, relating to the business of the broker-dealer;(f) All guarantees of accounts and all powers of attorney and other evidence of the granting of any discretionary authority given in respect of any accounts, and copies of resolutions empowering an agent to act on behalf of a corporation, limited liability company, partnership or other third parties; and(g) All written agreements (or copies thereof) entered into by such broker-dealer relating to its business, including agreements with respect to any account.(4) Broker-dealers not registered with the SEC or not members of FINRA or of any national securities exchange registered with the SEC that buy and sell securities or hold securities for the account of customers shall preserve for a period of not less than five (5) years after the closing of any customer's account, for the first (2) two years in an easily accessible place, all account cards, records or other documents that relate to the opening and maintenance of any customer's account, including all records and documents relating to the terms and conditions of such account (in paper or electronic media storage).(5) Broker-dealers not registered with the SEC or not members of FINRA or of any national securities exchange registered with the SEC that buy and sell securities or hold securities for the account of customers shall maintain and preserve all records with respect to "associated persons" required by Subsection (2)(l) above and all similar records required to be kept by other agencies for a period of at least five (5) years after the employment of the "associated person" has terminated and he or she has no other connection with the broker-dealer.(6) Broker-dealers not registered with the SEC or members of FINRA or of any national securities exchange registered with the SEC that do not hold securities for the account of customers and whose securities transactions are limited to selling securities shall make and maintain the following records: (a) With respect to every sale of securities made by such broker-dealers, the following records shall be made and maintained for five (5) years, for the first two (2) years in an easily accessible place: 1. A description of the types and amounts of securities sold;3. The sales price and how such price was determined;4. The commission earned and received for such sale by the broker-dealer and any agent;5. The name and address of: (i) The person to whom the security(ies) was (were) sold;(ii) The agent who made the sale; and(iii) The issuer or other person on whose behalf the sale was made;(b) Originals of all communications received and copies of all communications sent by such broker-dealer (including interoffice memoranda and communications) relating to the sale of securities; and(c) For each agent employed, a copy of the agent's application to the Commissioner for registration as an agent and all orders, notices or correspondence received by the broker-dealer with respect to such agent's registration.(7) Every broker-dealer shall preserve, during the life of the enterprise and of any successor enterprise, all partnership articles or, in the case of a corporation or limited liability company, all articles of incorporation or charter, minute books and stock certificate books or similar documents.(8) Agents who are not subject to the record keeping requirements of the SEC, FINRA or any national securities exchange registered with the SEC shall make and maintain for five (5) years, for the first (2) two years in an easily accessible place, a record of all commissions, overrides, draws, salary, expenses and other compensation or remuneration received in connection with his or her securities sales efforts and the following records with respect to every sale of securities in which such agent participates in any way:(a) A description of the type and amount of securities sold;(b) The date of the sale;(c) The sales price and how such price was determined;(d) The commission earned and received for such sale;(e) A copy of any sales confirmation, subscription agreement and other contract relating to the sale;(f) The name and address of the purchaser; and(g) The name and address of any person in addition to the agent who participated in the sale, a description of the nature of the participation and the compensation or remuneration received by such other person for his or her assistance.(9) Any record required by this Rule to be preserved and maintained may, after it is no longer required to be kept in an easily accessible place, be maintained in any form admissible into evidence pursuant to Code Section 24-5-26. Such records may be thus maintained at any time if equipment for viewing and reproducing such records is immediately accessible and any cost of such viewing or reproduction will be borne by the broker-dealer or agent.(10) Any broker-dealer that is registered with the SEC, is a member of FINRA or is a member of any national securities exchange registered with the SEC that fulfills the reporting requirements of the SEC, FINRA or national securities exchange, as it is required, shall be deemed to be in compliance with reporting requirements of the Act and the Rules.Ga. Comp. R. & Regs. R. 590-4-5-.06
O.C.G.A. Secs. 10-5-40, 10-5-70, 10-5-74.
Original Rule entitled "Books and Records" adopted. F. Nov. 18, 2011; eff. Dec. 8, 2011.