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Taping Rule

What is 'Taping Rule'

A rule created by the National Association of Securities Dealers (NASD) that requires that special supervisory procedures be put in place when a specific percentage of a firm's employees are hired from brokers/dealers that have been expelled or have had their registration revoked because they breached trading regulations.

Explaining 'Taping Rule'

The percentage that is used to determine whether the supervisory procedures need to be enacted depends on the size of the firm - it ranges from 40% for a small firm to 20% for a large firm. The supervisory procedures involve recording all of the telephone conversations made between registered employees and both potential and existing customers for three years. There are currently 25 firms that are recognized by the NASD as disciplined firms.


Further Reading


MP3s are killing home taping: The rise of Internet distribution and its challenge to the major label music monopoly
www.tandfonline.com [PDF]
… “Industry rule number 4080, record … Instead, as seems to have been the case with home taping, music downloaders believe music occupies a special place in their lives and in the world, a place that they believe is not subject to the same rules and regulations found in the …

Kinesio taping or just taping in shoulder subacromial impingement syndrome? A randomized, double-blind, placebo-controlled trialKinesio taping or just taping in shoulder subacromial impingement syndrome? A randomized, double-blind, placebo-controlled trial
www.tandfonline.com [PDF]
… “Industry rule number 4080, record … Instead, as seems to have been the case with home taping, music downloaders believe music occupies a special place in their lives and in the world, a place that they believe is not subject to the same rules and regulations found in the …



Q&A About Taping Rule


What is considered a small firm according to this rule?

A small firm has less than 100 registered representatives on staff at any given time.

What is the Taping Rule?

The Taping Rule is a rule created by the National Association of Securities Dealers (NASD) that requires special supervisory procedures to be put in place when a specific percentage of employees are hired from brokers-dealers that have been expelled or had their registration revoked because they breached trading regulations.

What is considered a large firm according to this rule?

A large firm has more than 500 registered representatives on staff at any given time.

How many firms are recognized by the NASD as disciplined firms?

There are currently 25 firms recognized by the NASD as disciplined firms.

Who created the Taping Rule?

The NASD created the Taping Rule.

What does the Taping Rule require?

The Taping Rule requires firms to record all telephone conversations made between registered employees and both potential and existing customers for three years.