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FINRA Rule 5320 Disclosure

To Our Clients

You should be aware that Imperial Capital may trade for its own account at prices that would satisfy your order (without executing your order) if: (i) you are an institutional investor; or (ii) you are an individual investor who places orders of 10,000 shares or more that are greater than $100,000 in value. Pursuant to Rule 5320 as described below, you may choose to “opt in” to the protections of Rule 5320 and disallow Imperial Capital from trading ahead of your orders.

FINRA Rule 5320 provides that a broker-dealer that accepts and holds an order in an equity security from its own customer or customer of another broker-dealer is prohibited from trading that security on the same side of the market for its own account at a price that would satisfy the customer order, unless it immediately thereafter executes the customer order up to the size and at the same or better price at which it traded for its own account.

With respect to orders for institutional accounts, or for orders of 10,000 shares or more that are greater than $100,000 in value, a broker-dealer is permitted to trade a security on the same side of the market for its own account at a price that would satisfy such customer order, provided that the broker-dealer has provided clear and comprehensive written disclosure to such customer at account opening and annually thereafter that:

  • Discloses that it may trade for its own account at prices that would satisfy the customer order; and
  • Provides the customer with a meaningful opportunity to “opt in” to the Rule 5320 protections with respect to all or any portion of the customer's order.

If you choose to “opt in” to these protections, you must notify the Imperial Capital Compliance Department in writing at 2000 Avenue of the Stars, 9th Floor, South Tower, Los Angeles, CA 90067, (310) 246-3700 or at compliance@imperialcapital.com




 
 
 

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