Overview
The Regulatory Element Program consists of periodic computer-based training on regulatory, compliance, ethical, supervisory subjects, and sales practice standards. Registered persons are required to participate and complete a designated Regulatory Element within a 120-day period that commences with the second anniversary of their initial securities registration, and reoccur every three years thereafter for as long as they remain in the securities business.
There are currently three different Regulatory Element Programs, the Supervisor Program for Registered Principals and Supervisors (S201), the Series 6 Program for Investment Company Products/Variable Contracts Representatives (S106), and the General Program for Series 7 Registered Persons and all other registrations (S101). Their content is derived from rules and regulations as well as standards and practices widely accepted within the industry. Although the specific requirements of certain rules may differ slightly among the various SROs, the programs are based on standards and principles applicable to all.
The S101 and the S106 Programs lead participants through scenarios depicting situations faced by registered persons in the course of their business. The format of the scenarios in the S101 and S106 are computer interactive text-based featuring audio segments. After reading the scenario, the participant must demonstrate their understanding of the issues by choosing the most appropriate response(s) to questions concerning the facts in the scenario. The programs assess the individual's understanding of the topic. If the individual does not show proficiency with the subject matter, the program delivers tutorials about the topics in the module and the participant must try again with another scenario in the same module. The participant must successfully complete one scenario in the module before advancing to the next module. The programs provide immediate feedback as participants work through the scenario questions. Both the S101 General Program and the S106 Series 6 Program are comprised of eight modules.
The S201 Program is specifically designed to enhance a supervisor's problem-detection and resolution skills. The program incorporates multimedia features that enable participants to observe live situations, and view various documents such as account statements, portfolios and industry forms, in order to solve the problems presented in the exercise. Participants review cases in categories as suitability, supervision, ethics, anti-money laundering, insider-trading, product knowledge, and interviewing and hiring.
