H.R. 7187
Clarity for Compensation Act
Summary:
• Amends the Securities Exchange Act of 1934 to create an exception so that a registered representative-owned "personal services entity" is not classified as a broker solely for receiving compensation on behalf of a registered representative from that representative's registered broker
• The exception applies only when specific conditions are met, including that the broker controls payment amounts and timing, the entity does not hold itself out as a broker, the entity does not engage in other broker activity, and ownership is limited to the registered representative and their immediate family members
• The bill takes effect 180 days after enactment and requires personal services entities to maintain books and records available to the Commission and applicable self-regulatory organization
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• The exception applies only when specific conditions are met, including that the broker controls payment amounts and timing, the entity does not hold itself out as a broker, the entity does not engage in other broker activity, and ownership is limited to the registered representative and their immediate family members
• The bill takes effect 180 days after enactment and requires personal services entities to maintain books and records available to the Commission and applicable self-regulatory organization
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