Series 28: Form U5 And Termination Of Service

Form U5 and Termination of Service

Should a person registered with a member firm resign or get laid off or fired, the member firm must file a Form U5 with FINRA within 30 days of the termination date. The firm must also provide a copy to the former employee within the same time frame. FINRA will assess a late filing fee on member firms failing to meet that deadline.

If a registered person leaves a member firm and associates with another member firm, the employee must provide a copy of Form U5 to the new employer upon request. The Form U5 must be provided either within two business days if the employee has obtained the form from the ex-employer or within two business days after receiving Form U5 from his ex-employer.

Form U5 requires the employer to specify whether the firing of an individual constitutes a full or partial termination. A full termination excludes an individual from all classes of registered employment in all jurisdictions throughout the industry and requires the employer to stipulate the reason for termination. If the registered employee was terminated because of standard of conduct violations or fraud, or if he is subject to investigations for criminal activity, Form U5 requires an explanation. However, a full termination is also used when an employee voluntarily resigns.

A partial terminati