Are plan lenders and employee stock ownership plans subject to the same inspection requirements as other nonbank lenders?
No. Employee stock ownership plans (ESOPs) are generally exempt from inspection (assuming no other margin stock secured credit outstanding). Plan lenders are only subject to an initial inspection within the first six months of registration (also assuming no other margin stock secured credit outstanding). This initial inspection is generally performed off-site. Entities with qualifying ESOPs or registered plan lenders that extend other types of margin-stock secured credit are subject to regular inspection in accordance with the schedule in question 3 above.
