021-14 Wyo. Code R. §§ 14-6 - Brokerage Services by Contract with Broker or Sale of Insurance or Annuities by Contract with Agent; Contents of Contract

(a) The bank may lease a portion of the bank premises to a broker to provide brokerage services to bank customers. The brokerage services may be provided exclusively by employees of the broker or by dual employees.

(b) Bank-related sales of insurance may be made exclusively by the contract agent or by a shared employee. No such contract shall be effective unless and until approved by the banks board of directors.

(c) If brokerage services are provided on or from bank premises by contract with a broker, the contract shall be in writing and, at a minimum, shall provide:

(i) A description of the duties and responsibilities of the bank and the broker;

(ii) A description of permissible activities by the broker on the banks premises, and the terms and conditions of use of the banks space, personnel and equipment;

(iii) That all representatives of the broker engaged in providing brokerage services on the bank premises, including any dual employees, shall be properly licensed and qualified as required by all applicable laws and regulations;

(iv) That the broker shall exercise exclusive supervisory and management control over dual employees when engaged in providing brokerage services and shall determine precisely the standardized investment advice to be provided to bank customers;

(v) That the broker shall recommend and the banks board of directors shall adopt, distribute and enforce written policies and procedures stating prohibited and permissible activities for the banks employees that are not dual employees;

(vi) That dual employees shall have written contracts, which shall not become effective unless and until approved by the bank;

(vii) That the bank shall pay the salaries of dual employees;

(viii) That the bank may monitor and periodically review the activities and transactions of the broker and its sales representatives to ensure compliance with the agreement;

(ix) That the bank and the appropriate banking regulatory authority shall have access to such records of the broker as are necessary or appropriate to evaluate compliance with the agreement; and

(x) That the broker shall indemnify the bank and save it harmless from any liability, cost or damages resulting from actions and omissions of the broker in providing brokerage services.

(d) If bank-related sales of insurance are permitted on or from bank premises by a contract agent, the contract shall be in writing and, at a minimum, shall provide:

(i) A description of the duties and responsibilities of the bank, the contract agent and any shared employees;

(ii) A description of permissible activities by the contract agent on or from bank premises;

(iii) The terms and conditions of use of the bank premises, personnel and equipment;

(iv) That all representatives of the contract agent engaged in selling insurance or annuities on or from bank premises, including any shared employees, shall be properly licensed under the insurance laws;

(v) That the contract agent shall provide written policies and procedures for evaluating comparative risks posed by offered insurance or annuities and for ensuring that the insurance and annuities offered are suitable for the bank customer;

(vi) That the contract agent shall provide written policies and procedures stating the standardized advice that shared employees must provide to bank customers;

(vii) That the contract agent shall recommend and the banks board of directors shall adopt, distribute and enforce written policies and procedures stating prohibited and permissible activities for the banks employees that are not dual employees;

(viii) That shared employees shall have written employment contracts with the contract agent, which shall not become effective unless and until approved by the banks board of directors;

(ix) The compensation arrangements for shared employees;

(x) That the bank may monitor and periodically review the activities and transactions of the contract agent and its representatives to ensure compliance with the contract;

(xi) That the bank, the appropriate banking regulatory authority, the Commissioner, the Insurance Commissioner and the Wyoming department of insurance shall have access to such records of the contract agent and its representatives as are necessary or appropriate.

(A) to evaluate compliance with the contract and the insurance laws; and

(B) to establish that the assets and records of the bank and the contract agent are segregated;

(xii) That the contract agent shall indemnify the bank and save it harmless from any liability, cost or damages resulting from actions or omissions of the contract agent and its representative arising out of all sales of insurance and annuities on or from bank premises, including all bank-related sales of insurance; and

(xiii) That the contract agent shall forward any customer complaints arising from any bank-related sale of insurance to the Insurance Commissioner, the Commissioner, and the bank.

(e) At a minimum, before making recommendations to a bank customer, a contract agent or shared employee shall make inquiries and document responses concerning the customers coverage objectives and instructions. A contract agent or shared employee may make a bank-related sale of insurance to a bank customer at the customers request, even if the insurance or annuity is inconsistent with the contract agents or shared employees recommendation, but the contract agent or shared employee shall document the recommendation.

(f) If the bank receives or learns of any complaint arising out of a bank-related sale of insurance made by a contract agent or a shared employee, the bank shall forward the complaint to the Insurance Commissioner and to the Commissioner.

Notes

021-14 Wyo. Code R. §§ 14-6