Gifts and Gratuities
Quick Answer
The FINRA gifts-and-gratuities requirement prohibits a member or associated person (AP) from giving anything of value to a person where the gift is in relation to that person's employer's business in excess of a per-person, per-year limit. The limit was raised to $300 effective March 30, 2026 under FINRA's "FINRA Forward" rule modernization (the
Quick Answer: The FINRA gifts-and-gratuities requirement prohibits a member or associated person (AP) from giving anything of value to a person where the gift is in relation to that person's employer's business in excess of a per-person, per-year limit. The limit was raised to $300 effective March 30, 2026 under FINRA's "FINRA Forward" rule modernization (the $100 limit applies to gifts given before that effective date). Gifts to a single recipient from the member and all its APs are aggregated, and the firm must keep a separate record of gifts subject to the requirement.
The requirement attacks the appearance and reality of buying influence. A gift small enough to fall below the cap is presumptively not a quid pro quo; a gift above the cap is presumptively improper unless it falls into a carve-out.
The General Rule
No member or AP may directly or indirectly give anything of value, including gratuities, in excess of the FINRA gift limit per individual per year, to any person where the gift is in relation to the business of the recipient's employer.
The Limit and the Effective Date
| Period | Per-Person, Per-Year Limit | Source |
|---|---|---|
| On or after March 30, 2026 | $300 | FINRA "FINRA Forward" amendments |
| Before March 30, 2026 | $100 | Original gift limit |
Both numbers are tested. The exam may present a fact pattern dated before or after March 30, 2026, and the candidate must apply the limit in effect at the time of the gift. Older study materials and FAQs may still reference the $100 limit.
Aggregation
All gifts to a single recipient from the member and its APs are aggregated in the annual count. A firm cannot route gifts through multiple APs to inflate the cap.
- Five $80 gifts from five different APs to the same recipient in a calendar year aggregate to $400 and breach a $300 limit
- The aggregation runs across the member firm, not just one office or one team
- "In relation to the business of the recipient's employer" is the trigger; personal gifts unrelated to the recipient's job (see carve-outs below) do not aggregate
Recordkeeping
The member must keep a separate record of all gifts subject to the requirement, including:
- Value of the gift
- Recipient (name and employer)
- Business purpose (what the gift was for)
This record is separate from the per-AP transaction records and from the offeror-side variable-contracts compensation records. A single gift may appear in multiple compensation records depending on its source and purpose.
Exam Tip: Gotchas
- The $300 limit is per person per year, not per gift. Five $80 gifts to the same recipient in a calendar year aggregate to $400 and breach the limit even though no single gift exceeds the cap. The exam often tests this with a fact pattern showing several gifts that individually pass but aggregate over the limit.
- The amendments effective March 30, 2026 raised the limit to $300. Older study materials and FAQs may still reference $100. Know both numbers and the effective date for the exam. The conforming amendments to the parallel cash/non-cash compensation requirements (DPPs, variable contracts, mutual funds, corporate financing) raised those caps to $300 on the same date.
What Counts and What Does Not
What Counts as a Gift
- Tangible items (wine, electronics, branded merchandise above nominal value)
- Gift cards (any face value)
- Sports tickets given without member attendance (the member's rep does not attend with the recipient)
- Charitable donations made in the recipient's honor
What Does NOT Count
| Carve-Out | Why It Does Not Count |
|---|---|
| Gifts from the member to its own APs | Governed by internal non-cash compensation requirements (variable contracts / mutual funds), not the gifts-and-gratuities cap |
| Gifts from a member or AP to individual retail customers | Governed by the firm's WSPs and other requirements (e.g., elder-abuse and unsuitability rules) |
| Personal gifts for personal occasions (weddings, baby births, bereavement) where there is no relationship to the recipient's business with the firm | The "in relation to the business" trigger is absent |
| Promotional items of nominal value bearing the firm's logo (pens, mugs, etc., generally well under the limit) | Below the line of meaningful business gifts |
| Business entertainment where the member's representative attends with the recipient (a meal, a ballgame) | Covered separately by the entertainment portion of cash/non-cash compensation requirements |
The personal-gift carve-out is fact-specific. A $500 wedding gift to a colleague who happens to also be a customer's compliance officer is plausibly personal if the friendship pre-dates and exists outside the business relationship; it is not plausibly personal if the only contact between the giver and recipient is the customer's account.
Exam Tip: Gotchas
- Business entertainment is NOT a gift if the member's representative attends with the recipient. A $500 dinner with a customer's portfolio manager that the rep attends is entertainment under the cash/non-cash compensation framework, not a gift. A $500 dinner gift card sent to the same person without the rep attending is a gift and would breach the cap.
- The personal-gift carve-out requires a genuinely personal relationship. A gift sent to a customer's child for the child's wedding is plausibly personal if the rep has known the family for years; it is not plausibly personal if the only contact between the rep and the family is the customer's account.
Interaction With Stricter Requirements
The FINRA gift limit is a floor, not a ceiling. Other rules may impose stricter limits for specific recipient types.
| Stricter Source | Recipients Covered |
|---|---|
| MSRB pay-to-play requirements | Government and municipal officials; dollar limits and prohibitions on certain political-related gifts |
| DOL ERISA rules | ERISA plan fiduciaries; gift restrictions vary by plan and fiduciary structure |
| SEC investment-adviser pay-to-play rule | Public-pension plan officials and similar government officials handling adviser selection |
A gift that is within the $300 FINRA limit can still violate one of these stricter requirements. A $100 gift to a state pension official may comply with the FINRA cap but violate the investment-adviser pay-to-play prohibition and trigger a multi-year ban on the firm doing business with that pension plan.
Exam Tip: Gotchas
- The FINRA gift cap is a floor, not a ceiling. Compliance with the $300 limit does not exempt a gift from MSRB pay-to-play, ERISA fiduciary rules, or the SEC adviser pay-to-play rule. A government-official recipient is the classic exam fact pattern: the firm must check the stricter rule's limit before relying on the FINRA cap.
- The firm's separate gift record must capture the recipient's employer and business purpose, not just the value. A $100 gift to "John Smith" with no employer or purpose noted fails recordkeeping even if the gift itself was within the cap. The record must let the firm or a regulator reconstruct whether the gift triggered the requirement.