Compliance Registered Options Principal (CROP)
What Is the Compliance Registered Options Principal (CROP)?
The Compliance Registered Options Principal (CROP) was a supervisory and compliance employee position that the Financial Industry Regulatory Authority (FINRA) required of options trading firms. This requirement was ultimately wiped out in June 2008.
Understanding the Compliance Registered Options Principal (CROP)
A firm was required to utilize a Compliance Registered Options Principal as a firm's officer or general partner and had the responsibility for guaranteeing regulatory compliance for its options trading activities for clients' accounts. The person additionally managed interactions with the public, like advertising and marketing. The CROP could likewise act as the Senior Registered Options Principal (SROP), one more position formerly required by FINRA. The SROP was an officer or general likewise responsible for overseeing options exposure and trading activity in clients' accounts.
In spite of the fact that trading options can be an investment apparatus used to reduce risk, they are additionally extremely dangerous in the hands of some unacceptable individuals; subsequently, the requirement for regulation.
To turn into a CROP, a person needed to pass the Series 4 exam in the United States and the Options Supervisors Course in Canada.
The End of CROP
FINRA at long last wiped out the CROP position on the grounds that other financial assignments could deal with the obligations formerly required of CROPs. In this way, that's what it concluded assuming firms kept on satisfying their supervisory and compliance requirements, they weren't required. That is a similar explanation FINRA got rid of the SROP position.
The changes didn't wipe out the requirement for firms to designate a Registered Options and Security Futures Principal (ROSFP) to manage the firm's public activities, like the substance of notices, instructive materials, and sales writing. The changes likewise made the ROSFP responsible for guaranteeing that customers could handle the risks of options trading and comprehend the transactions proposed for their discretionary accounts.
Features
- To turn into a CROP, a person needed to finish the Series 4 exam in the United States and the Options Supervisors Course in Canada.
- This requirement was in the long run killed in June 2008.
- Compliance Registered Options Principal (CROP) was a supervisory and compliance employee position that FINRA required of options trading firms.
- The CROP was employed as an options firm's broad partner or officer and was responsible for guaranteeing regulatory compliance for its clients' options trading activities.
- The CROP could likewise act as the Senior Registered Options Principal (SROP), one more position formerly required by FINRA.
