Succession and Mass Transfers

When firms are combined by merger or acquisition, the NASD will determine how the CRD transactions are handled. In a situation where the surviving firm that results from the transaction maintains the old CRD number of its partner, the firm need only file its normal Form BD amendments via CRD. There are no state fees involved and nothing need be filed regarding agents.

When one firm succeeds to the business of another firm and the new firm is not currently registered as a broker-dealer with the NASD, a new CRD number will be issued for the new firm. The firm will be instructed by the NASD on what Form BD filings to make. Fees due for the firm will be deducted from the firm's CRD account.

In cases where agents at an old firm must be moved to a firm with a different CRD number, the NASD will prepare a Mass Transfer of agents. The NASD sets the date the transfer will take place based on the firm's request. The firm will advise the CRD which agents will transfer in each jurisdiction. The Division receives a notice via CRD that a Mass Transfer will be taking place but no information regarding agents until the transfer is actually completed.

Once the transfer is completed, the Division will receive a list of each agent transferred in Wisconsin. We will then send the firm a copy of the list and a letter instructing the firm to forward its check for the $30 per agent licensing fee for each agent on the list, including those agents transferred in a PENDING status. Agent Mass Transfer fees are NOT deducted from the firm's CRD account; they are paid directly to the Division.

The firm should review the agent list to ensure all desired agents have transferred properly. NOTE: only the agents on the list will have been approved as part of the Mass Transfer. If an agent's name does not appear on the list, even though they have been licensed in Wisconsin at their previous firm and should have been included, that person must stop transacting business in Wisconsin until the firm files a separate U4 and the agent is approved in Wisconsin.

Any discrepancies in the agents transferred or not transferred should be directed to the CRD.

If payment for the agent transfers is not received promptly, the agents may be termed for non-payment of the licensing fee. If that happens, individual U4s will need to be submitted for each agent to again become licensed.

If a firm involved in a transaction that results in a change of CRD number for the surviving broker-dealer has branch offices in Wisconsin, filings must be made directly with the Division. NO BRANCH OFFICE FILINGS ARE MADE VIA CRD. The firm must advise the date of change in ownership for each branch and provide a list of all Wisconsin branches that should be opened under the surviving firm's CRD number. That list should contain the same information outlined in the Branch Office section of this Guide. Along with the list, the firm must include its check for $30 for each branch being opened under the new BD CRD number.