As part of its effort to increase the amount of information about brokers available to investors, Finra has discussed requiring reps with Series 7 licenses to post the test scores they received on the agency's BrokerCheck system.
Robin Traxler, vice president for legislative affairs at the Financial Services Institute (FSI), said that Finra had discussed this possibility at a meeting late last year. Speaking in front of about 400 financial advisors at FSI's second annual Financial Advisor Summit in Washington D.C., Traxler added that their organization would urge Finra to focus on providing investors with information that was timely and relevant.
Judging from the reaction of advisors in the audience, some appeared faintly amused while others were visibly irritated about making public the test scores they received years, or in many cases, decades ago. Until recently, the possibility of making brokers test scores public was never part of any regulatory discussion. "They are moving the goalposts," commented one attendee.
While Traxler was by no means certain Finra would proceed with such a requirement, she did say that FSI expected Finra to strengthen its requirement about making "timely" disclosures liens and judgments against reps with Series 7 and other licenses.
Finra May Require Series 7 Scores On BrokerCheck
September 29, 2014
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Comments
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I'm all for this. But I want Obama's college transcripts made public too.
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While we're at it, lawyers should have their bar exam scores posted (No exemptions for members of congress),doctors should have their state med boards scores posted, etc.
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Somebody needs to explain what the relevance of posting scores would be. Most advisors take these tests in the first year they are in business with no significant other background or experience, and even in that first year, the score only indicates they can pass the test. At that point in time, without the aid of a mentor, they know just enough to be dangerous. I'm sure that if you were to do a study, the biggest scam artists in the business who have ripped off the most consumers probably also had the highest scores. I believe that test scores would only confound and confuse consumers.
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This is silly. Most who took the test knew they had to receive a score sufficient to pass. So that's what they did. The test, in my opinion, does not measure competence, if you measure competence by the ability to match a client's goals with investments designed to meet those goals. Yet that is precisely the way clients would perceive the results. I got a very high score, and was a broker for 22 years before switching to managed accounts 12 years ago, so I personally have no fear of score disclosure. FINRA, with all the disclosure requirements you impose on the industry, why don't you consider an appropriate disclosure/disclaimer should you decide to require this? Something like this: "We include the test score for your consideration, although we have no evidence that the score is indicative of the quality of advice you will receive, the ethics of the person giving you that advice, or the likelihood of the success of your investments."