Why am I required to disclose my employment with a financial institution?

Rule 407 of the New York Stock Exchange prohibits a member organization (i.e., IB) from opening a securities or commodities account or executing any transaction for an account in which an exchange member, employee associated with another exchange member or member organization or an exchange employee is directly or indirectly interested without prior written consent of the employer.  The rule also requires IB to promptly submit to the account holder's employer duplicate account statements and confirmations.

Applicants who designate employment or affiliation with another broker are required to submit a Rule 407 letter containing the email address of their organization in order to provide notification and consent to the employer and for the purpose of transmitting statements and confirmations.  If the employment is with a financial institution and  no such Rule 407 letter is submitted, IB's Compliance Department will typically contact the applicant in order to confirm that Rule 407 does not apply.

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