Series 54: 1.2.4. Municipal Securities Dealers

1.2.4. Municipal Securities Dealers

Collectively, all broker-dealers and bank dealers that underwrite, trade, and sell municipal securities are known as municipal securities dealers.

The 1934 Act defines a municipal securities dealer as any person, including a separately identifiable department or division of a bank, engaged in the business of buying and selling municipal securities for its own account. However, municipal securities dealers do not include:

• Those that buy or sell municipal securities for their own account but not as part of a regular business

• Banks that only act as agents, not dealers (However, remember that a separate division or department of a bank that engages in municipal securities business would be deemed a municipal securities dealer.)

Example: Big Bank is a commercial bank that sells 529 plans to its customers. It operates