Ensure Supervisors perform their functions
Maintain procedures designed to ensure Supervisors properly carry out their supervisory functions.
Understanding the obligation
Rule 3905(6) requires a Dealer Member to have procedures that ensure Supervisors are properly performing their supervisory functions. This addresses the operation of supervision itself: appointing Supervisors and assigning tasks is not the end of the firm's responsibility.
Procedures should be capable of identifying whether supervisory work is being carried out as expected. The subsection does not specify a universal testing frequency or particular audit methodology. Those details may arise from other requirements or the firm's own supervisory design.
Requirements
- Establish procedures addressing whether Supervisors properly perform their assigned supervisory functions.
- Use those procedures to support actual performance of supervisory responsibilities, rather than relying solely on formal designations.
Practical considerations Illustrative
Implementation examples, rather than additional express requirements.
- Define how completion and quality of key supervisory activities are checked.
- Consider escalation when required reviews are missed, delayed or incomplete.
- Clarify who assesses supervisory performance and how identified gaps are followed up.
Potential evidence Illustrative
Examples of evidence; the cited provisions may not mandate these records.
- Procedures for oversight of supervisory performance
- Supervisory review completion records
- Exception or overdue-review reports
- Follow-up and remediation records