Series 28 Exam: Understanding, Application, and FAQs

Series 28, overseen by the Financial Industry Regulatory Authority (FINRA), plays a pivotal role in ensuring the competence of professionals tasked with financial recordkeeping and regulatory compliance within the securities industry. The exam targets individuals aspiring to roles as licensed recordkeepers or operations principals for broker-dealers or securities custodians. Referred to as “FinOps” in the industry, these professionals bear the responsibility of upholding regulatory standards and overseeing the accurate maintenance of financial firms’ books and records.

To excel in compliance-related roles, candidates must possess in-depth knowledge not only of regulatory frameworks but also of the diverse range of securities transactions encountered in the financial landscape. This entails understanding the intricacies of recording investment transactions accurately and consistently in accordance with legal requirements, including those stipulated in the Securities Investor Protection Act of 1970 and other relevant regulations.

Series 28 underscores the fiduciary significance of meticulous recordkeeping in protecting investor accounts and maintaining market integrity. In today’s dynamic financial environment, retail investors access a plethora of investment options, ranging from stocks and bonds to complex derivatives. Each transaction must be meticulously recorded and adapted to reflect various financial events such as income and principal payments, redemptions, and accrued interest.

Professionals who pass the Series 28 exam demonstrate their capability to safeguard the investing public’s interests by adhering to stringent regulatory standards. This certification enhances career prospects, particularly for those eyeing roles in compliance, risk management, and back-office operations within the financial sector.

The Series 28 exam comprises 95 multiple-choice questions distributed across four major content areas: financial reporting, operations, general securities industry regulations, net capital, and customer protection. Candidates are allotted two hours to complete the exam, with a passing score of 69% or higher required for certification. Unlike some other financial exams, Series 28 has no prerequisites, although candidates must be sponsored by a qualifying member firm to sit for the exam.

The exam primarily evaluates candidates’ understanding of securities industry operations, regulatory compliance protocols, and financial reporting accuracy. Key subject areas include the proper handling of customer assets, adherence to net capital requirements, and ensuring the accuracy and integrity of financial records.

Individuals seeking to take the Series 28 exam must be sponsored by a qualifying member firm, either registered with FINRA or another eligible self-regulatory organization (SRO).

Passing the Series 28 exam demonstrates proficiency in financial recordkeeping and regulatory compliance, qualifying individuals for roles overseeing the books and records of broker-dealer member firms.

Candidates can prepare for the Series 28 exam by utilizing study materials provided by FINRA, participating in review courses, and gaining practical experience in financial operations and regulatory compliance.

There is no limit to the number of times a candidate can attempt the Series 28 exam. However, each attempt requires registration and payment of exam fees.

While there are no specific continuing education requirements for Series 28 certification, professionals in compliance-related roles are encouraged to stay informed about changes in regulatory standards and industry best practices.

Individuals who obtain Series 28 certification can pursue various roles in compliance, risk management, and back-office operations within the financial sector. This certification enhances their credibility and opens doors to opportunities for advancement within the industry.