Form U4 and Form U5
Every securities career begins with a Form U4 and ends with a Form U5. These two forms create a public record that follows registered persons throughout their careers and beyond.
Overview
| Feature | Form U4 | Form U5 |
|---|---|---|
| Full name | Uniform Application for Securities Industry Registration or Transfer | Uniform Termination Notice for Securities Industry Registration |
| Purpose | Register an individual with FINRA and/or states through a member firm | Terminate an individual's registration when they leave a firm |
| Who files | The member firm (not the individual) | The member firm (not the individual) |
| When filed | Before an individual begins registered activities | Within 30 days of termination |
| Public access | Yes, through BrokerCheck | Yes, through BrokerCheck |
- Both forms are filed by the firm, not the individual
- Both are publicly accessible through BrokerCheck, FINRA's free online tool that lets anyone look up a broker's background
Form U4: Registration
The Form U4 is used to register an individual with FINRA, self-regulatory organizations (SROs), and state regulators. It collects extensive background information, including employment history, disciplinary history, and financial disclosures.
Key U4 Disclosures
The individual must answer "yes" and provide details for any of the following:
- Criminal history: Felony charges or convictions; securities-related misdemeanor charges or convictions
- Regulatory actions: Sanctions by the SEC, states, or SROs
- Customer complaints: Written complaints alleging $5,000 or more in damages
- Terminations for cause: Discharged, or permitted to resign under investigation
- Financial disclosures: Bankruptcies, unsatisfied liens or judgments, bond denials
- Civil litigation: Lawsuits related to investment activities
Exam Tip: Gotchas
- Form U4 requires disclosure of charges, not just convictions. An individual charged with a felony must disclose it even before trial.
- Customer complaints must be reported at the $5,000 threshold even if the firm believes the complaint has no merit.
Update Obligation
- Form U4 must be updated within 30 days of any material change in disclosed information
- This is a continuing obligation; as long as the person is registered, they must keep their U4 current
Form U5: Termination
The Form U5 is filed when a registered person leaves a member firm. It tells regulators why the person left and whether any issues were pending.
Types of U5 Filings
| Type | Purpose |
|---|---|
| Full Form U5 | Terminates an individual's registration with all SROs and jurisdictions |
| Partial Form U5 | Terminates registration with selected SROs/jurisdictions only (no termination reason or disclosure questions required) |
What the U5 Must Disclose
- Reason for termination (voluntary, terminated, permitted to resign, etc.)
- Any pending customer complaints
- Internal reviews or investigations
- Regulatory investigations
Continuing Obligation
- The firm must amend the U5 if new information arises after filing
- This obligation continues until there is final disposition of any reportable matter
- After termination, individuals remain subject to regulator jurisdiction for at least 2 years
Exam Tip: Gotchas
- The firm files the U5, not the individual. U5 must be filed within 30 days of termination.
- The firm's obligation to amend continues even after the person leaves.
BrokerCheck
- BrokerCheck is FINRA's free public tool for looking up registered brokers and firms
- Available at brokercheck.finra.org
- Displays information from both Form U4 and Form U5
- Includes: employment history, licenses, customer complaints, regulatory actions, and financial disclosures
- Anyone can search; no account required
Exam Tip: Gotchas
- Both Form U4 and Form U5 information is publicly available through BrokerCheck. Anyone can look up a broker's background.