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Series 6
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Textbook
Introduction
1. Common stock
2. Preferred stock
3. Debt securities
4. Corporate debt
5. Municipal debt
6. US government debt
7. Investment companies
8. Insurance products
9. The primary market
10. The secondary market
11. Brokerage accounts
12. Retirement & education plans
13. Rules & ethics
13.1 The regulators
13.2 Public communications
13.3 Social media
13.4 Regulation BI
13.5 Registered representative rules
13.6 Regulation S-P
13.7 Protecting vulnerable investors
13.8 Restitution & penalties
13.9 Recordkeeping requirements
14. Suitability
Wrapping up
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13.6 Regulation S-P
Achievable Series 6
13. Rules & ethics

Regulation S-P

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Regulation S-P specifically deals with protecting the personal and private information of customers of financial firms. In the age of technology, certain measures must be taken to safeguard customer privacy.

Regulation S-P identifies what is considered private information. Items like social security numbers, suitability information, and account balances are obviously private. Data obtained through internet cookies is a little less obvious. Regardless, all of these items must be safeguarded properly.

In addition to identifying and protecting private information, Regulation S-P requires disclosure to customers when non-public information is provided to third parties. For example, your firm must tell you if it sends your non-public information to a third-party company to print checks. In order to print checks, the third party needs access to account numbers and private account information.

Firms must disclose this information at account opening and annually after. Additionally, the firm must provide the customer with an “opt-out” feature, which would prevent the firm from disclosing private information to third parties. Opt-out features must be easy to submit; check-off boxes on letters or e-mails are commonly utilized. More difficult measures, like requiring a customer to write a lengthy letter requesting the opt-out, are prohibited.

Key points

Regulation S-P

  • Safeguards non-public customer info
  • Firms must disclose when giving non-public info to third parties
  • Privacy notices provided:
    • At account opening
    • Annually after
  • Firms must provide easy “opt-out”

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