Communication Categories Under FINRA Rule 2210
Every written or electronic communication from a broker-dealer falls into one of three categories. The category determines who must approve it, when it must be filed, and how it is supervised. Getting this classification right is the foundation for everything else in this unit.
The Three Categories
FINRA Rule 2210 classifies all written (including electronic) communications into three categories based on audience size and type:
| Category | Definition | Audience | Key Threshold |
|---|---|---|---|
| Retail communication | Distributed or made available to more than 25 retail investors within any 30 calendar-day period | General public, retail customers | > 25 retail investors in 30 days |
| Institutional communication | Distributed or made available only to institutional investors | Banks, insurance companies, registered investment companies, investment advisers, entities with $50M+ in assets | Institutional investors only |
| Correspondence | Distributed or made available to 25 or fewer retail investors within any 30 calendar-day period | Small group of retail customers | 25 or fewer retail investors in 30 days |
- A retail investor is any person other than an institutional investor
- A firm's internal communications are excluded from all three categories
The key threshold is 25. More than 25 retail investors in 30 days = retail communication. Twenty-five or fewer = correspondence.
Exam Tip: Gotchas
- The 25-person count uses a rolling 30-calendar-day period, not per mailing. If you send an email to 26 retail customers over 30 days, it is a retail communication, even if you sent them one at a time.
- Internal communications are NOT correspondence. They are excluded from all three categories entirely.
- An email blast to a firm's entire client list is almost always a retail communication.
Institutional Investor Defined
An institutional investor under FINRA Rule 2210 includes:
- Banks, savings institutions, and insurance companies
- Registered investment companies (mutual funds)
- Registered investment advisers
- Any person (natural or entity) with total assets of at least $50 million
- Government entities
- Employee benefit plans meeting certain size requirements
- FINRA member firms and registered associated persons
Exam Tip: Gotchas
- A high-net-worth individual with $50 million in total assets qualifies as institutional under Rule 2210. The exam may test whether a wealthy individual's communications count as institutional or retail.
Public Appearances
Public appearances are a separate category from the three written communication types. They include:
- Seminars and forums
- Radio or television interviews
- Other unscripted public speaking activities
If an associated person recommends a security during a public appearance, the person must:
- Have a reasonable basis for the recommendation
- Disclose any financial interest in the securities of the issuer (unless the interest is nominal)
Exam Tip: Gotchas
- A scripted seminar presentation shown to more than 25 retail investors is a retail communication (not a public appearance) and requires principal pre-approval. Only unscripted public speaking qualifies as a public appearance.
Quick Classification Flowchart
Use this decision tree when the exam asks you to classify a communication:
- Is it written or electronic?
- No (unscripted speaking): Public appearance
- Yes: Continue to step 2
- Is it available only to institutional investors?
- Yes: Institutional communication
- No: Continue to step 3
- Will more than 25 retail investors receive it within 30 days?
- Yes: Retail communication
- No: Correspondence