Series 22

The Series 22 license, also known as the Direct Participation Programs Limited Representative Exam, is administered by the Financial Industry Regulatory Authority (FINRA). It empowers individuals to engage in the sale of direct participation programs (DPPs) and other relevant securities.

This license allows you to directly participate in the solicitation, purchase, and sale of limited partnerships and limited liability companies, among other products.

In this article, you’ll learn about the specific exam prerequisites and steps you must take to obtain and maintain your Series 22 license.

What is the Series 22 License?

The Series 22 License, also known as a Direct Participation Programs Limited Representative Exam, enables individuals to work in the securities industry as direct participation program representatives. These professionals primarily focus on non-traded, pooled investments like real estate investment trusts (REITs), oil and gas programs, and more.

These are just some of their major job functions of a direct participation program representative:

• Seeks business for the broker-dealer from customers and potential customers.
• Opens accounts after obtaining and evaluating customers’ financial profile and investment objectives
• Provides customers with information about investments, makes recommendations, transfers assets and maintains appropriate records
• Obtains and verifies customers’ purchase instructions and agreements, processes, completes and confirms transactions

All in all, getting a Series 22 license can be a good idea if:

• Your career interest lies in selling non-traded, pooled investments like real estate investment trusts (REITs), oil and gas programs, etc.
• You’re a financial advisor or broker who wants to provide a wider range of offerings to your clients. (Having a Series 22 license can allow you to sell DPPs, potentially boosting your income and client base.)
• You aspire to increase your professional credibility and competitive advantage as well as access new career opportunities within the financial industry. (The specialized knowledge gained from a Series 22 license can be a valuable asset.)

If you’re interested in direct participation programs and willing to put in the time to study and understand them, obtaining a Series 22 license can represent a significant step forward in your career.

How to Get Your Series 22 License

Before starting the Series 22 examination, you must ensure you satisfy the following requirements:

• You’re associated with and sponsored by a FINRA member firm or another applicable self-regulatory organization (SRO)
• You’ve passed the Securities Industry Essentials (SIE) Exam
• You have an approved accommodation for scheduled online appointments

Once you’re eligible for this type of FINRA exam, you should prepare thoroughly. The Series 22 exam will test your knowledge of direct participation programs, including the regulations, tax implications, and unique characteristics of these types of investments.

Exam Preparation and Procedure 

The Series 22 license exam (Direct Participation Programs Representative Exam) is a required stepping stone for those seeking to work in the field of direct participation programs (DPPs).

The exam evaluates the proficiency of prospective entry-level representatives in carrying out their responsibilities as direct participation programs representatives.

While the exam might seem daunting at first glance, it’s entirely possible to pass it on your first attempt. Here’s how:

• Understand the exam structure. The exam includes 50 multiple-choice questions with a time limit of 75 minutes. To pass, you must achieve a score of 70% or higher. Understanding the structure of the exam can help you allocate your study time efficiently, emphasizing areas in which you may seem weaker.

• Practice consistently. Taking mock tests will help you familiarize yourself with the exam format, practice time management, and identify any potential areas of weakness. By answering as many practice questions as possible, you can build confidence and improve your understanding of the material.
• Stay informed. FINRA and the US Securities and Exchange Commission (SEC) regularly publish updates and notices about changes in the industry so make sure you keep up with the latest rules and regulations in the field.
• Use study materials and resources. Take advantage of the multitude of resources available, including study guides, textbooks, online course modules, and practice exams. 

We recommend using an online service to prepare for your Series 22 license exam. These services usually provide question and answer sessions, video classes taught by financial services professionals and DPP experts, and a wealth of online study guides and tools to help you study in the best way possible.

Maintaining Your License

Maintaining your Series 22 license involves more than just passing the initial exam; it requires ongoing education and active engagement within the industry.

Here are some suggestions to help you maintain your license and a competitive edge:

• Complete continuing education courses. FINRA requires you to complete continuing education (CE) courses in order to maintain your Series 22 license. This includes both the regulatory element, which you must complete in your first two years and then every three years thereafter, and the firm element, which your employer will determine based on your specific job function
• Stay updated on current regulations. The financial industry, including direct participation programs, continues to evolve with changing regulations and updates from FINRA along with new investment vehicles
• Attend industry events. Conferences, seminars, and webinars can provide excellent venues in which to learn about the latest industry trends, network with others in your field, and gain insights that can help you in your role

By staying current with industry trends and continually investing in your professional development, you’ll be able to maintain your Series 22 license and excel in your role.