FINRA Rule 4311
With respect to this section, GTN has opened your securities account and has retained a Clearing Firm to provide certain record keeping or operational services. These services—such as settlement of securities transactions, custody of securities and cash balances, and extension of credit on margin transactions—are provided under a written Clearing Agreement between GTN and the Clearing Firm. As a member of FINRA, GTN is required (under FINRA Rule 4311) to disclose to you the details of its Clearing Agreement, which are summarized below. This document addresses the basic allocation of functions regarding the handling of your account. It is not meant as a definitive enumeration of every possible circumstance, but only as a general disclosure.
Responsibilities of GTN.
GTN has the responsibility to:
- Approve the opening of your account
- Obtain necessary documentation to help fight the funding of terrorism and money laundering activities (Note: U.S. law and international best practices require firms to obtain, verify and record information that identifies each person who opens an account. This information may be used to perform a credit check and verify your identity through internal sources or third-party vendors)
- Service and supervise your account through its own personnel in accordance with its own policies, procedures, applicable laws, regulations and rules
- Know you and your stated investment objectives
- Provide appropriate investment advice, recommendations or management services based on your investment objectives
- Determine whether particular kinds of transactions—such as margin, options and short sales—are appropriate for you
- Obtain the initial margin as required by Regulation T if a margin account is opened for you
- Accept and, in certain instances, execute securities orders
- Know the facts about any orders for the purchase or sale of securities in your account
- Comply with fair pricing and disclosure responsibilities (if your firm is a market maker in any securities or otherwise trades as principal with you)
- Correctly identify and promptly forward cash or securities intended for your account to GTN
- Supervise the activities of any individual who services your account
- Resolve any complaints regarding the handling of your account
- Manage the ongoing relationship that it has with you.
Responsibilities of the Clearing Firm.
The Clearing Firm has no involvement relating to the servicing of your account. In general, the Clearing Firm is only responsible for the services within the scope of the Clearing Agreement that is provided at the request of your firm and contains specific direction regarding your account. As such, the Clearing Firm may fulfill the following responsibilities on behalf of your account:
- Create computer-based account records
- Receive and deliver cash and securities
- Record such receipts and deliveries according to information provided either by your firm or directly, in writing, by you
- Hold securities and cash in custody (after they come into the Clearing Firm’s physical possession or control)
- Collect and disburse dividends, capital gains and interest
- Process reorganization and voting instructions with respect to securities held in custody
- Prepare and transmit confirmations of trades to you (or provide facilities to your firm to provide these functions)
- Prepare and transmit periodic account statements summarizing transactions
- Provide your firm with written reports of all transactions processed for your account to enable your firm to carry out its responsibilities under the Clearing Agreement
- Assist you and your firm with any discrepancies or errors that may occur in the processing of transactions
If your firm opens a margin account for you, the Clearing Firm may:
- Loan you money for the purpose of purchasing or holding securities (subject to the terms of the Clearing Firm’s written Margin Agreement, margin policies and applicable margin regulations)
- Calculate the amount of maintenance margin required and advise you of those requirements (usually through your firm)
- Calculate any interest charged on your debit balance
In connection with all of the functions that the Clearing Firm performs, the Clearing Firm maintains the books and records required by law and business practice. The Clearing Agreement does not encompass transactions in commodities futures contracts or investments other than marketable securities, which the Clearing Firm normally processes on recognized exchanges and over-the-counter (OTC) markets. In furnishing the Clearing Firm’s services under the Clearing Agreement, the Clearing Firm may use and rely upon the services of clearing agencies, automatic data processing vendors, proxy processing vendors, transfer agents, securities pricing services and other similar organizations.
- The Clearing Firm does not control, audit or otherwise supervise the activities of GTN or its employees.
- The Clearing Firm does not verify information provided by GTN regarding your account or transactions processed for your account.
- The Clearing Firm does not undertake responsibility for reviewing the appropriateness of transactions entered by GTN on your behalf.
If you have any questions about this policy, please write, call, or email us.
4509 Creedmoor Road, Suite 201
Raleigh, NC 27612 United States
Call us: +1 332 230 1184