It is not permitted to request a client sign a blank or partially blank form. Any alterations to a form already signed by the client require the client to initial the changes. This includes adding information or correcting information on the already signed form.
Potential Scenario 1: A client asks you to please not email her all the pages of various forms for her signature. She asks you to only email her the signature pages to sign. She trusts you and you have thoroughly discussed the transaction. She returns the signed signature pages to you via email. You add the signed signature pages to the various forms and submit for processing.
This is a violation of the requirement that clients only sign forms after reviewing the fully completed documents. Sending a client just the signature pages, without all the other completed pages of the forms, is akin to asking the client to sign a blank form. This is not permitted.
Potential Scenario 2: A client does not have their bank account information available, as they are opening a new checking account at a new bank. The client signs all the account paperwork and says he will call you later with the bank account information so you can add that information to the mutual fund application. This is the quickest way to get the account opened and processed and allows the client to sign now while he is in your office.
This is a violation of the requirement that clients only sign forms after reviewing the fully completed documents. This is akin to requesting the client sign a partially blank form and is not permitted. Adding or changing any information after a client signs a form requires the client to initial those additions or changes.
Potential Scenario 3: An older client does not use email and is not savvy enough to do e-signature via Adviceworks Docusign. The client lives 3 hours away and comes in for office appointments when visiting his grandchildren in your town. The client signs all the required paperwork to open a new advisory account while in your office and then travels back to his home 3 hours away. You notice the wrong box for the Liquid Net Worth range was checked on the AIF. Instead of bothering the client, you make the correction and replace the page in the original AIF and submit for processing.
This is making a correction to a client-signed form and is not permitted. In this scenario, please contact the Prosperity Network OSJ. We can provide guidance as to whether the correction is permitted to be initialed by the rep or must be returned to the client for their initials.
Please contact the Prosperity Network Compliance Team with any questions. compliance@prosperityadvisors.com or 913-529-5500 Option 2.
Dianne L. Eggert, CFE
Compliance Manager
Internal Use Only