FAQ




15c2-11 Filings

What is SEC Rule 15c2-11?
Under Rule 15c2-11, the Securities Exchange Commission states that it is unlawful for a U.S. securities broker or dealer to initiate or resume quotations for any security unless certain information regarding the issuer is available and the broker or dealer has a reasonable basis for believing that the information is accurate and obtained from reliable sources.

What is the Form 211?

The Form 211 is the form which must be completed and submitted to FINRA OTC Compliance Unit by a market maker to initiate or resume quotations in the OTCBB, the "Pink Sheets", or any other comparable quotation medium pursuant to SEC Rule 15c2-11. (source: www.otcbb.com)

What information is need Key West for  to consider quoting a security?
We encourage each potential issuer to review the questions and request items found within our 211 Questionnaire.  It is also recommended that you consult your legal counsel.

What are some differences between companies quoted on by an OTC quotation service and companies listed on a stock market? 
Stock markets (including NASDAQ and the registered exchanges, such as NYSE or AMEX) have specific quantitative and qualitative listing and maintenance standards, which are stringently monitored and enforced. Companies listed on a stock market have reporting obligations to the market, and an on-going regulatory relationship exists between the market and its listed companies. OTC quotation services (OTCBB, Pink Sheets) facilitate quotation of unlisted securities. As such, any regulatory relationship between an OTC quotation service and the issuers may be relatively limited or non-existent. (source: www.otcbb.com)

What are the "listing" requirements for the OTCBB?
Because the OTCBB is a quotation service for FINRA Market Makers, not an issuer listing service or securities market, there are no listing requirements that must be met by an OTCBB issuer. Accordingly, there are no financial requirements and there is no minimum bid price requirement.  (source: www.otcbb.com)

What are the eligibility requirements for the OTCBB?
In order for a security to be eligible for quotation by a market maker on the OTCBB, the security must be registered with the Securities and Exchange Commission (SEC) or other federal regulatory authority that has proper jurisdiction (see below) and the issuer must be current in its required filings with such federal authority.
Domestic issues quoted on the OTCBB are limited to the following securities:

  • securities of issuers that make current filings pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 ("Act");
  • securities of depository institutions that are not required to make filings under the Act, but file publicly available reports with their appropriate regulatory authorities;
  • securities of registered closed-end investment companies; and
  • securities of insurance companies that are exempt from registration under Section 12(g)(2)(G) of the Act.
Foreign issues and ADRs must be registered with the Securities & Exchange Commission (SEC) pursuant to Section 12 of the Securities Exchange Act of 1934. (source: www.otcbb.com)

Do financials submitted with the Form 211 have to be audited?
Yes, the periodic reporting requirements under NASD Rule 6530 require annual audits of an OTCBB issuer's financial statements. However, current FINRA rules do not require the financial statements of Pink Sheet issuers to be audited, but they should be prepared in accordance with GAAP or, for foreign issuers, in accordance with their home country's accounting standards. (source: www.otcbb.com)

Are OTCBB company auditors required to be registered with the Public Company Accounting Oversight Board (PCAOB)?
Effective October 22, 2003, auditors of all domestic public companies must be registered with PCAOB. As specified in Section 102 of the Sarbanes-Oxley Act, it is unlawful for an auditor of a public company to issue an audit opinion if they are not registered with PCAOB. Filings with audit opinions of an unregistered PCAOB auditor are considered to be incomplete and not in compliance with Rule 6530. (source: www.otcbb.com)

Why don't I get Inside Quote (Best Bid and Best Ask) Information for all OTCBB securities?
There must be at least two bid and two ask quotations to calculate the inside market for a security. Because only one Market Maker is required on the OTCBB and Market Makers are permitted to post one-sided quotes and unpriced indications of interest, there may be securities for which inside quotes can not be calculated.  (source: www.otcbb.com)



ACAT Processing

Do you accept account transfers to third parties?
No.  We will only transfer assets to a like named account that does not constitute a change of ownership.

Can I still trade in my account once my ACAT has been initiated?

If processing a full ACAT (meaning all assets of the account are transferring to an entirely different Broker/Dealer) then the account will be closed to all trading.  If you are processing a partial ACAT (meaning only some of the assets are transferring to an entirely different Broker/Dealer) then you would still be able to actively trade in the account, but you would not be able to trade the securities that are in transfer.

How long will it take to process my ACAT request?
Usually ACATS take approximately 4-7 business day to complete although here are times when it may take longer.

I have a Mutual Fund.  Will I be able to transfer my mutual fund through ACATS?
The ACATS department will send all Mutual Fund transfer requests to be processed through the Mutual Fund department.  If the clearing house does not have an agreement with that fund, then the Mutual Fund department will request a liquidation.


Check Deposits

Do you accept money orders, cashier's checks, or traveler's checks?
We do not accept these types of checks, nor do we accept checks drawn on lines of credit, checks drawn on lines of equity or official checks for deposit to foreign accounts.

Do you accept third party checks?

We do not accept third party checks which is any check that is drawn on an account other than the one of the same name as the account holder or any check that is not made payable to COR Clearing (our clearing firm).

When will my funds be available to me?
Once the check posts to the account, you will be required to wait 10 business days before the funds are available for withdrawal.

Can I use my check deposit to trade in my account?
If the deposit is under $25,000, then you will have to wait one business day before you can use the funds to trade.
If the deposit is greater than $25,000, then you will have to wait five business days before you can use the funds to trade.


Corporate Accounts

What is a corporate brokerage account?
A corporate brokerage account is one titled under the legal name of a corporation.  Multiple authorized officers may be on this type of account.  All tax reporting is done by way of the corporation's Federal ID tax #.

I want to open a corporate brokerage account with your firm.  At what point should I send in the completed account opening documentation?
You will first need to make contact with a broker here and discuss the details of your transaction.  If our compliance department approves your transaction, you can then proceed to fax or email in the account opening documentation.  If you will be depositing shares, you will first want to complete an Equity Deposit Questionnaire (EDQ).

What forms are required to open a corporate (cash) brokerage account?

  • The New Account Approval Form (Page 1***&2), Customer Account Agreement, Corporate Account Agreement, Initial Privacy Notice, & Receipt of Documentation.   These forms can be found under New Accounts>Corporate Account Packet.
  • If opening this account as a Margin account, then substitute the Customer Account, Margin & Short Account Agreement for the Customer Account Agreement,
  • Each authorized individual or beneficial owner will need to complete a Customer Identification Addendum, as well as submit an unexpired government issued identification.  Government-issued identification includes driver's licenses, state identification cards and/or passports.  The Customer Identification Addendum form can be found under New Account>Corporate Account Packet
  • In addition to these forms, we will need the documentation you used to set up the corporation (i.e. Articles of Incorporation, Corporate Charter, Copy of By-Laws, etc.).   We will need documentation from the state or province in which you set up the company, confirming when the it was formed and that it is still active.
  • If your company is not a public company and shares have been issued, then we will need a copy of your stock register.
***We are now requiring the signature line on page 2 of the New Account Approval Form to be notarized.

Do you need the original documentation?
You can fax us or scan into an email the required documentation.  The only instance for which we require original documentation is in the case of the W-8BEN for a foreign company.

Do you open accounts for corporations in Canada?
If the authorized account holder is living in Canada, but the corporation was formed in the United States and will receive its mail in the United States, then we can proceed to open the account.  We are unable to open accounts for Canadian corporations.



DRS Processing

What is a DRS deposit?
The D.R.S. or Direct Registration System allows shareholders to hold their registered owned securities in electronic book form at the transfer agent, instead of having a physical certificate.  Using the Direct Registration System you can deposit shares from the transfer agent electronically (if the transfer agent is a participant).

What is the fee to process a DRS transfer?
Please check our fee schedule.

What are the advantages of processing shares electronically as opposed to depositing a physical certificate?
Processing shares electronically can save on time, fees and risks associated with a lost certificate.

I want to make a DRS deposit of shares I own.  What is the next step?
You will first need to make contact with a broker here and discuss the details of your transaction.  The broker will have you complete an Equity Deposit Questionnaire.  See Guidelines for Depositing OTC Securities.  Once our compliance department has approved your transaction you can then open an account, or if you have one already open, you will complete a DRS Request Form and provide us a statement (dated within 3 months) from the transfer agent showing the shares that you are requesting.  Your statement must include your investor ID number.You will then need to wait an additional 48-72 hours after the initial request before sending another.



DTC Processing

What is a DTC Transfer?
A DTC transfer allows you to transfer DTC eligible shares from one brokerage account to another brokerage account.  Each firm has a unique DTC number which you must provide to the sending firm.

What are the advantages of processing shares electronically as opposed to depositing a physical certificate?
Processing shares electronically can save on time, fees and risks associated with a lost certificate.

Do I need pre-approval to deposit shares into my acount via a DTC trasnfer?
Yes.  You will first need to make contact with a broker here and discuss the details of your transaction.  The broker will have you complete an Equity Deposit Questionnaire.  See Guidelines for Depositing OTC Securities.  Once our compliance department has approved your transaction you can then open an account, or if you have one already open, you will be given authority to request the DTC from the sending firm.


DVP Accounts

What is a DVP Account?
DVP stands for Delivery Versus Payment.  These accounts involve a settlement procedure in which the seller of a security agrees to pay the buyer upon the security's delivery to the seller.  Many of these accounts are carried with a Prime Broker or Custodian.

I want to open a DVP account with your firm.  At what point should I send in the completed account opening documentation?
You will first need to make contact with a broker here and discuss the details of your transaction.  If our compliance department approves your transaction, you can then proceed to fax or email in the account opening documentation.   If you will be depositing shares, you will first want to complete an Equity Deposit Questionnaire.  See Guidelines for Depositing OTC Securities.

What forms are required to open up an individual account?
You must complete the New Account Application For DVP.


DWAC Processing

What is a DWAC?
The acronym DWAC is for Deposit/Withdrawal At Custodian and is run by The Depository Trust Company (DTC). It allows DTC participants to electronically transfer DWAC eligibble shares to or from a transfer agent.

What is the fee to process a DWAC?
Please check our fee schedule.

What are the advantages of processing shares electronically as opposed to depositing a physical certificate?
Processing shares electronically can save on time, fees and risks associated with a lost certificate.

I want to make a DWAC deposit of shares I own.  What is the next step?
You will first need to make contact with a broker here and discuss the details of your transaction.  The broker will have you complete an Equity Deposit Questionnaire.  See Guidelines for Depositing OTC Securities.  Once our compliance department has approved your transaction you can then open an account, or if you have one already open, you can proceed to initiate the DWAC.  The transfer agent must receive instructions from the issuer or shareholder to accept the DWAC.  We will then initiate the DWAC and if our instructions match the instructions at the transfer agent, then the shares will be transferred into your account.  You should usually allow a business day for the shares to appear in the account.

Am I able to DWAC shares out of my account?
If the issuer is DWAC eligible you would be able to transfer shares back to a Transfer Agent.



Fee Schedule


Please check our new fee schedule as of Dec 1, 2013.

Fee Disclosure
Please contact your broker for information regarding any fees prior to transacting in your account.  The fees provided throughout this website are estimates based on the current rates charged to our clients and may have changed.


Fund Withdrawals

How much does it cost to transact a wire out of my account?
Please check our fee schedule above.

Do you process third-party wires?
No.  We will not process any wires to a third party account, which is any account other than the same name as the account holder.

What is the cut-off for wires at your firm?
We will not accept wire requests after 5:00 PM PST.



Individual or Joint Accounts

What is an individual brokerage account?
An individual brokerage account is one titled under the legal name of one person.  This single individual is reposonsible for this account and all tax reporting is done by way of this person's provided social security number.

I want to open an individual (or joint) brokerage account with your firm.  At what point should I send in the completed account opening documentation?
You will first need to make contact with a broker here and discuss the details of your transaction.  If our compliance department approves your transaction, you can then proceed to fax or email in the account opening documentation.  If you will be depositing shares, you will first want to complete an Equity Deposit Questionnaire (EDQ)

What forms are required to open up an individual account?
Along with a non-expired government issued identification (i.e. passport and/or driver license), at a minimum the following documentation must be submitted:

  • New Account Approval Form (Pages 1*** & 2), Customer Account Agreement, Initial Privacy Notice, and Receipt of Documentation.  
  • Foreign individual accounts will also need to submit an original W-8BEN, which must be mailed into our firm.  
These forms can be found under New Accounts>Individual Account

***We are now requiring the signature line on page 2 of the New Account Approval Form to be notarized.

Do you need the original documentation?
You can fax us or scan into an email the required documentation.  The only instance for which we require original documentation is in the case of the W-8BEN for a foreign individual.

Do you open accounts for Canadian citizens?
If the individual is residing in Canada, then we are unable to open the account.  If the individual is permanently residing in another non-banned country, then we would be able to open the account.

I want to open an account jointly with another person.  Will this person also need to complete the same paperwork?
Yes.  There is a section on the New Account Approval Form for the joint account holder.  All account opening documentation requiring signatures will need to be signed by both parties.  There are different types of joint accounts (i.e. Joint Tenants in Common, Joint with Rights of Survivor-ship or Joint Tenancy, Tenants by the Entirety and Community Property.  In the event of an unexpected death, all of these types of joint accounts treat remaining assets differently, so it is important to discuss with your broker the ramifications of each.  The type of joint account is determined by completing the Joint Account Agreement.  These forms can be found under New Accounts>Joint Accounts.



IRA Accounts

What is an IRA account?
IRA stands for Individual Retirement Account.  It is an account that is used to save money for retirement and which offers certain tax benefits.  There are several different types of IRA accounts that can be opened, i.e. Rollover, SEP, Roth, and Traditional  The most common are the Roth IRA and Traditional IRA.  You should consult with a financial adviser to find the type of IRA account which fits your retirement needs best.

I want to open an IRA account with your firm.  At what point should I send in the completed account opening documentation?
You will first need to make contact with a broker here and discuss the details of your transaction.  If our compliance department approves your transaction, you can then proceed to fax or email in the account opening documentation.   If you will be depositing shares, you will first want to complete an Equity Deposit Questionnaire (EDQ) .

What forms are required to open an IRA account?
Along with a non-expired government issued identification (i.e. passport and/or driver license), at a minimum the following documentation must be submitted:

  • New Account Approval Form (Pages 1*** & 2), Customer Account Agreement, Initial Privacy Notice, and Receipt of Documentation.
  • If opening this account as a Margin account, then substitute the Customer Account, Margin & Short Account Agreement for the Customer Account Agreement,  
  • IRA Simplifier 
These forms can be found under New Accounts>IRA


Limited Liability Company Accounts

What is a Limited Liability Company brokerage account?
A  Limited Liability Company brokerage account is one that is set up by a Limited Liability Company.  This type of company is not a corporation.  It is owned by members who have limited liability.  An LLC account will have its own Fed ID #.

I want to open a Limited Liability Company brokerage account with your firm.  At what point should I send in the completed account opening documentation?
You will first need to make contact with a broker here and discuss the details of your transaction.  If our compliance department approves your transaction, you can then proceed to fax or email in the account opening documentation.  If you will be depositing shares, you will first want to complete an Equity Deposit Questionnaire (EDQ)

What forms are required to open an Limited Liability Company brokerage account?

  • The New Account Approval Form, Customer Account Agreement, Limited Liability Company Authorization, Initial Privacy Notice, & Receipt of Documentation.
  • If opening this account as a Margin account, then substitute the Customer Account, Margin & Short Account Agreement for the Customer Account Agreement,
  • Each authorized member or manager will need to complete a Customer Identification Addendum, as well as submit an unexpired government issued identification.  Government-issued identification includes driver's licenses, state identification cards and/or passports.
  • In addition to these forms, we will need the documentation you used to set up the corporation (i.e. Articles of Association, Operating Agreement, etc.).  We will need documentation from the state or province in which you set up the LLC, confirming when it was formed and that it is still active.
Do you need the original documentation?
You can fax us or scan into an email the required documentation.  The only instance for which we require original documentation is in the case of the W-8BEN for a foreign company.

Do you open accounts for corporations in Canada?
If the authorized account holder is living in Canada, but the company was formed in the United States and will receive its mail in the United States, then we can proceed to open the account.  We are unable to open accounts for Canadian companies.



Non-Restricted or Free Trading Securities

Are there any fees associated with clearing a free trading security?
Yes.  There are multiple fees associated with clearing any physical certificate.  For details please check our fee schedule.  If there are multiple certificates deposited at the same time, then only one deposit fee is charged.  The Transfer Agent and DTC also have their own fees for transfer.

How long does it take to clear shares from a physical certificate and have them available for sale?
After the clearing firm delivers the shares out for transfer, you will be waiting at a minimum 7-10 business days before the shares are available for sale.

I want to deposit some free trading certificates issued to me?  What is the next step?
You will first need to make contact with a broker here and discuss the details of your transaction.  The broker will have you complete an Equity Deposit Questionnaire.  You will need to send in a copy of your certificate front and back.  See Guidelines for Depositing OTC Securities.  Once our compliance department has approved your transaction you can then open an account, or if you have one already open, you can proceed to send in the certificate.



Partnership Accounts

What is a Partnership account?
A partnership account is opened by two or more people in which each person is equally liable.  A partnership will have its own Fed ID #.

I want to open a partnership account with your firm.  At what point should I send in the completed account opening documentation?
You will first need to make contact with a broker here and discuss the details of your transaction.  If our compliance department approves your transaction, you can then proceed to fax or email in the account opening documentation.   If you will be depositing shares, you will first want to complete an Equity Deposit Questionnaire (EDQ)

What forms are required to open a partnership account?
Along with a non-expired government issued identification (i.e. passport and/or driver license), at a minimum the following documentation must be submitted:

  • New Account Approval Form (Pages 1*** & 2), Customer Account Agreement, Partnership Agreement, Initial Privacy Notice, and Receipt of Documentation.  
  • If opening this account as a Margin account, then substitute the Customer Account, Margin & Short Account Agreement for the Customer Account Agreement,
  • Copy of the Partnership Agreement (this is a different form than the one we provide)
  • Foreign Partnerships will also need to submit an original W-8BEN, which must be mailed into our firm.  
These forms can be found under New Accounts>Partnership

***We are now requiring the signature line on page 2 of the New Account Approval Form to be notarized.

Do you need the original documentation?
You can fax us or scan into an email the required documentation.  The only instance for which we require original documentation is in the case of the W-8BEN for a foreign individual.

Do you open accounts for Canadian citizens?
If the Canadian citizen is living permanently outside of Canada and receiving his/her mail there and the Partnership is setup outside of Canada, then we could open a Partnership account.



Restricted and/or Control Securities

What are Restricted and Control Securities?
Restricted securities are securities acquired in unregistered, private sales from the issuer or from an affiliate of the issuer.  Investors typically receive restricted securities through private placement offerings, Regulation D offerings, employee stock benefit plans, as compensation for professional services, or in exchange for providing "seed money" or start-up capital to the company.  Rule 144(a)(3) identifies what sales produce restricted securities.

Control securities are those held by an affiliate of the issuing company.  An affiliate is a person, such as a director or large shareholder, in a relationship of control with the issuer.  Control means the power to direct the management and policies of the company in question, whether through the ownership of voting securities, by contract, or otherwise.  If you buy securities from a controlling person or "affiliate," you take restricted securities, even if they were not restricted in the affiliate's hands.

If you acquire restricted securities, you almost always will receive a certificate stamped with a "restricted" legend.  The legend indicates that the securities may not be resold in the marketplace unless they are registered with the SEC or are exempt from the registration requirements.  The certificates of control securities are usually not stamped with a legend.  (source: www.sec.gov)

How do I remove a Restrictive Legend?
"Restricted" securities are securities acquired in an unregistered, private sale from an issuer or from an affiliate of the issuer. They typically bear a legend clearly stating that you may not resell them in the public marketplace unless the sale is exempt from the SEC’s registration requirements.

Rule 144 under the Securities Act of 1933 provides the most commonly used exemption for holders of restricted securities. To take advantage of this rule, you must meet several conditions, including a one-year holding period.

Even if you’ve met all the conditions of Rule 144, you still cannot sell your restricted securities to the public until you’ve had the legend removed from the certificate. Only a transfer agent can remove a restrictive legend. But the transfer agent won’t remove the legend unless the issuer consents—usually in the form of an opinion letter from the issuer’s counsel to the transfer agent.

If you want to remove the restrictive legend, you should contact the company that issued the securities—or the transfer agent for the company’s securities—to ask about the procedures for removing a legend. If you have a broker, you may want to ask your broker to help you.

If a dispute arises about whether a restricted legend can be removed, the SEC will not normally intervene. The removal of a legend is a matter solely in the discretion of the issuer. State law, not federal law, covers disputes about the removal of legends.

If you are considering acquiring restricted securities, it would be wise for you to consult an attorney who specializes in securities law.  (source: www.sec.gov)

What is Form 144?
This Form must be filed with the SEC as notice of the proposed sale of restricted securities or securities held by an affiliate of the issuer in reliance on Rule 144. Notice on the Form is only required when the amount to be sold during any three-month period exceeds 500 shares or units or has an aggregate sales price in excess of $10,000. The sale must take place within three months of filing the Form and, if the securities have not been sold, an amended notice must be filed. (source: www.sec.gov)



Sole Proprietorship Accounts

What is a sole proprietorship account?
A type of business entity which is run by one individual, often under a trade name other than his/her legal name.  A sole proprietorship account is opened under the individual's social security number.

I want to open a sole proprietorship brokerage account with your firm.  At what point should I send in the completed account opening documentation?
You will first need to make contact with a broker here and discuss the details of your transaction.  If our compliance department approves your transaction, you can then proceed to fax or email in the account opening documentation.   If you will be depositing shares, you will first want to complete an Equity Deposit Questionnaire (EDQ).

What forms are required to open a sole proprietorship brokeage account.
Along with a non-expired government issued identification (i.e. passport and/or driver license), at a minimum the following documentation must be submitted:

  • New Account Approval Form (Pages 1*** & 2), Customer Account Agreement, Affidavit of Sole Ownership, Initial Privacy Notice, and Receipt of Documentation.  
  • If opening this account as a Margin account, then substitute the Customer Account, Margin & Short Account Agreement for the Customer Account Agreement,
  • Foreign accounts will also need to submit an original W-8BEN, which must be mailed into our firm..
  • Copy of DBA Filing (required when individual is operating under a trade name)
These forms can be found under New Accounts>Sole Proprietorship

***We are now requiring the signature line on page 2 of the New Account Approval Form to be notarized.

Do you need the original documentation?
You can fax us or scan into an email the required documentation.  The only instance for which we require original documentation is in the case of the W-8BEN for a foreign individual.

Do you open accounts for Canadian citizens?
If the individual is residing in Canada, then we are unable to open the account.  If the individual is permanently residing in another non-banned country, then we would be able to open the account.


Trust Accounts

What is a Trust Account?
A Trust account is setup so a trustee can administer an account for the benefit of one or more beneficiaries.  Most Trusts have their own Fed ID #.

I want to open a Trust Account with your firm.  At what point should I send in the completed account opening documentation?
You will first need to make contact with a broker here and discuss the details of your transaction.  If our compliance department approves your transaction, you can then proceed to fax or email in the account opening documentation.  If you will be depositing shares, you will first want to complete an Equity Deposit Questionnaire (EDQ).

What forms are required to open up a Trust Account?

  • The New Account Approval Form (Page 1***&2), Customer Account Agreement, Trustee Certification, Initial Privacy Notice, & Receipt of Documentation.  These forms can be found under New Accounts>Trust Account
  • Each Trustee will need to submit an unexpired government issued identification.  Government-issued identification includes driver's licenses, state identification cards and/or passports. 
  • We will need to be provided a copy of the trust.
Do you need the original documentation?
You can fax us or scan into an email the required documentation.  The only instance for which we require original documentation is in the case of the W-8BEN for a foreign company.

Would you open a trust setup in Canada?
No.  We are unable to open Canadian trust accounts.



Wire Deposits

Can I wire funds into my account if it is pending?
No.  You must wait until we have provided you with an account number.

Do you accept third party wires into an account?
It is Key West's policy not to accept third party wires.

What are the instructions for wiring funds into my account?
You can use the following to instructions to fund your account via a wire:

The Bank of New York
Omaha, Nebraska
ABA No. 021000018 (for non-domestic wires, use SWIFT Code IRVTUS3N)
For benefit of: COR Clearing, Account No. 8900620633
For further credit to: Your Account Name and Account Number

What is the most common reason for a wire not to post to my account?

You must remember to provide your bank with both your account name and your account number.

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