Agency Supervisory Officer
The volume and complexity of insurance, advisory, and securities regulations continue to grow. For this reason, the Company requires the General Agent (GA) to hire dedicated individuals to handle supervisory matters, referred to as Agency Supervisory Officers (ASO). While the GA will still retain ultimate control and supervisory responsibility for the agency, the ASO has responsibility for assisting in handling the supervisory tasks. The ASO is a valued member of the agency management team. The GA must ensure the ASO has the stature and authority within the agency to direct compliance with Company policies and procedures.
ASOs must have, at the time of hire:
- A BA or BS degree or equivalent experience;
- Series 7, 24 (or Series 9 and 10), and 53 registrations, or acceptable securities regulatory experience;
- At least 3 to 5 years’ experience in the securities industry preferably with at least 1 year of prior supervisory experience;
- No material disciplinary history; and
- A home state securities license and Massachusetts securities licenses (if applicable).
These qualifications are minimum requirements. If an Agency has Registered Representatives who solicit or sell municipal bonds, options, or other non-conventional investments, the ASO should have adequate experience in these products to provide effective supervision.
Prior to hiring an ASO, candidates must be interviewed (generally, by telephone) and approved by the Regional Vice President or Regional Supervisory Director (RSD) after consultation with Compliance (the Regional Head of Field Compliance). If the individual is hired, the GA must sign the candidate’s Form U4.
The ASO is a full-time employee of the Agency, and reports directly to the GA. The ASO generally cannot actively engage in personal production but may receive incidental first year and new commissions (e.g., for business involving friends and family members) as well as renewal and trail commissions on business written before becoming the ASO. If an ASO intends to be actively involved in personal production the Regional Vice President or RSD must approve the arrangement. Approvals, if any, will be limited to situations where there are extraordinary circumstances as the ASO is generally expected to engage in supervisory activities on a full-time basis.
As the ASO’s employer, the GA has the right to terminate the individual. (MMLIS has the right to terminate the ASO’s FINRA registration.) If the GA is contemplating the termination of the ASO, they must discuss this step with the Regional Vice President or RSD and Regional Head of Field Compliance before taking any action.
The GA and ASO must execute the Agency Supervisory Officer Contract. This contract exists in addition to any employment agreement the GA may choose to make with the ASO.
The ASO is responsible for completing formally delegated duties that were assigned to the GA in this manual. As stated in Delegation of Functions, the General Agency may not delegate responsibilities pertaining to hiring and firing decisions, disciplinary authority for significant matters, associate assignments (including delegating supervisory responsibilities) or supervising the agency ASOs. Common responsibilities of an ASO includes, but are not limited to:
- Client File Reviews
- Compliance Resource
- Detached Office Inspections and Monitoring
- Disciplinary Actions and Monitoring of Tailored Supervision Plans
- Approving and Monitoring Outside Business Activities
- Personal Interviews
- Securities Correspondence Reviews
- Subsequent Activity Best Interest Review for Certain Recommendations
- Training and Education
The ASO may serve as the primary liaison for the agency with regulators and Compliance. In particular,
- Greet, meet with, and assist regulators during examinations, and report the status of such examination to Compliance personnel;
- Facilitate announced and unannounced agency inspections by Compliance and Regional Vice Presidents or RSDs;
- Assist the GA in responding to inspection reports prepared by Compliance personnel;
- As requested, assist Compliance, legal and/or audit personnel during Company investigations;
- Promptly transmit to Compliance and/or legal personnel written customer complaints, demands and legal actions received by Producers and agency associates; and
- Promptly advise Compliance and/or legal personnel of all threatened complaints, demands and legal actions against Producers and agency associates.