Is a CEDIF an exempt product? One that can be sold by selling agents not regulated under the MFDA or IDA?
It is an exempt product, however only firms that are members of the Investment Dealers Association can sell a CEDIF without any additional regulatory approval. If a MFDA member firm wised to sell this security, that firm would first have to apply to the Commission for an exemption from Sec. 13(c) of the Regulations. This would require the firm to assume all liabilities that come with the sale of the security and the sales would have to be “on the book” of the dealer. If the exemption were to be granted, then the proficiency of the individual salesperson would have to be addressed. My occupation being a Financial Advisor, does the NSSC see any problem with me being a director on a CEDIF board, provided we are a volouteer board and I provide full disclosure to any clients questionning the CEDIF? No objection to a financial advisor being a director on a CEDIF board, as long as he does not sell any shares while continuing to be a registrant.
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