How to secure sponsorship for Series 7 licensing
Getting your Series 7 license is a core requirement for launching many careers in the finance industry. Unlike the FINRA SIE exam, obtaining your Series 7 license requires Series 7 sponsorship from a FINRA (Financial Industry Regulatory Authority) member firm. You cannot register for or take the Series 7 exam without sponsorship. In this post, we’ll break down what Series 7 sponsorship involves and guide you through the steps to secure sponsorship for the Series 7 exam.
What is sponsorship for Series 7 licensing?
If you haven’t encountered the term before, Series 7 sponsorship simply means that a FINRA-member firm agrees to sponsor your application for the Series 7 license, enabling you to become a FINRA-registered representative under their organization. In practice, this process involves an active, FINRA-regulated firm submitting your personal details to the FINRA Central Registration Depository (CRD), covering your Series 7 exam fees, and taking responsibility for your activities once you obtain your license.
Once your sponsoring firm completes your Series 7 sponsorship and officially registers you for the Series 7 exam, you will receive a 120-day testing window to take and pass the exam before needing to reapply and pay additional fees. Successfully passing the Series 7 exam allows you to earn your Series 7 license and become a Registered Representative with FINRA. At that point, your sponsoring firm assumes ongoing oversight of your professional conduct within the securities industry.
How to apply for Series 7 sponsorship
To begin the sponsorship process, either you or your sponsoring organization must complete and submit the Form U4 through FINRA’s official Form U4 portal. The Form U4, also known as the Uniform Application for Securities Industry Registration or Transfer, is a comprehensive 39-page document that collects detailed information about your personal background, professional history, and any criminal disclosures.
What’s asked for on the Form U4
- Personal information
- Examinations requested
- Residential addresses for the last 5 years
- Employment history for the last 5 years
- Any professional designations held
- Other business activities, including other jobs besides employment with your sponsoring firm
- Disclosures of important financial events, such as bankruptcies, liens, and settlements
- Disclosure of any criminal, regulatory, or civil litigation matters
Form U4 submission process
Your sponsoring member firm will submit the completed Form U4 and the required filing fees to FINRA on your behalf. Before submitting Form U4, the firm must conduct comprehensive background checks and public records searches to verify the accuracy of the information provided. This process ensures that there are no missing disclosures or new reportable items relevant to your Form U4 filing. To ensure full compliance, work closely with your sponsoring member firm’s compliance department and carefully review all details on your Form U4. Be truthful and thorough: never attempt to omit or falsify information when completing the Form U4.
Statutory disqualification
In some circumstances, U4 disclosures could result in “statutory disqualification”, which will prevent you from becoming registered. Some examples of disqualifying events include: any felonies in the past 10 years; misdemeanors related to cash or securities; or past regulatory breaches. If these events are reported (and you should report them if they are true), your sponsoring firm can apply to FINRA to get a waiver to proceed with the registration. These procedures can incur extra costs and additional supervisory procedures, but they can help move the process along. Also, while you have to report bankruptcies and liens on the U4, these will not lead to statutory disqualification.
Fingerprinting
After submitting the Form U4, you must ensure your fingerprint is recorded and sent to FINRA within 30 days as part of the Form U4 registration process. These fingerprints are checked against national criminal databases to identify any misconduct or criminal history that could result in statutory disqualification under Form U4 guidelines. Collaborate with your compliance team for detailed instructions on completing this Form U4 fingerprinting requirement.
Can’t get Series 7 sponsorship support? Consider passing the FINRA SIE exam first
The FINRA Securities Industry Essentials (SIE) Exam is a critical co-requisite for most securities registrations, including the Series 7 exam. As prospective financial professionals navigate the Series 7 registration process, taking and passing the SIE is an essential requirement. However, what sets the SIE exam apart from other FINRA exams, such as the Series 7, is one fundamental difference: Series 7 sponsorship is not required to attempt the SIE.
Unlike the typical Series 7 exam—which mandates firm sponsorship and employer backing—the SIE exam can be taken independently. Some financial firms may prepare new hires to pass both the SIE and Series 7 exams by providing Series 7 sponsorship as part of their onboarding programs. For those who have not secured sponsorship, preparing for and successfully completing the SIE exam independently demonstrates initiative and commitment, a strong differentiator for candidates competing for positions that may lead to eventual Series 7 exam sponsorship.
Taking the SIE exam is also an excellent strategy for college students interested in launching a finance career, professionals seeking to switch industries, or anyone already working in finance looking to transition into a client-facing role that requires passing the Series 7 exam. Starting with the FINRA SIE is highly recommended, as the exam content provides foundational knowledge and serves as an accessible introduction for those progressing toward the more advanced requirements of the Series 7 exam.
To register for the SIE, visit FINRA’s website directly and pay the $80 filing fee out of pocket. For further details on scheduling your exam or a step-by-step guide to taking the SIE exam, refer to our comprehensive blog post.
Conclusion
The Series 7 is a vital advancement tool for finance professionals interested in becoming registered brokers of financial products such as mutual funds, UITs, ETFs, and more. To ensure compliance with FINRA regulations, verify that your firm's sponsorship and U4 form have been processed and accepted. If you are unable to obtain sponsorship, there are steps you can take to improve your qualifications, such as taking and passing the foundational SIE Exam. Use the right resources to understand how Series 7 sponsorship affects your licensure journey, and take time to prepare for passing the Series 7 exam.
