How do you know if your investment industry job duties or the duties of one of your reps require a Series 7 license, Series 79 license or both? This depends on the activities being performed. The General Securities Representative (Series 7) examination covers a broad range of industry activities such as retail customer solicitation and sales, trading, etc. that investment bankers seldom, if ever, engage in. The Investment Banking Representative (Series 79) registration category was developed for those whose job responsibilities include advising on and facilitating the marketing of an offering. Unfortunately, confusion exists about which registration is necessary and whether people need both registrations for the work they are performing.
Investment banking activities can include preparing a marketing plan, advising on a marketing plan that was prepared by a sales team, and playing a part in developing or contributing information for marketing materials. Not included in the scope of this registration is actively marketing the offering and interacting with investors or potential investors. If an investment banking representative participates in activities such as road shows, this person also needs to be registered as a General Securities Representative (Series 7), a Corporate Securities Representative (Series 62 which is no longer available to be taken) or a Private Securities Representative (Series 82). The type of offering being made determines which of these registrations is necessary.
When a person is engaged only in selling the offering or actively marketing the offering to investors, the Series 79 is not necessary. That activity can be conducted with the Series 7. But if this person also engages in the preparation of a marketing plan, advises on a marketing plan that was prepared by a sales team, or develops or contributes information that was included in the marketing materials, then the Series 79 registration is required as well.
If a registered person’s activities are limited to areas that are covered by other Limited Representative categories, such as Private Securities Offerings (Series 82) or Direct Participation Programs (Series 22), this person will most likely not be required to also have the Series 79.
Activities that could require the Series 79 include:
• Advising on marketing plan prepared by sales team
• Preparing a marketing plan
• Contributing to information used in marketing materials
• Pricing of securities in debt and equity offerings
• Selling assets
• Deals with equity capital markets and
• Debt capital markets
• Corporation reorganization or divestitures
• Managing the allocation and stabilization activities of offerings
• Mergers and acquisitions and financial restructuring
• Transactions involving business combinations including rendering solvency and fairness opinions
We hope that this article has helped you determine which registration is required.