When should a broker handle transactions covered by Form 144?

The correct answer is that broker involvement in transactions covered by Form 144 should happen upon receiving confirmation of filing. Form 144 is a notice used by affiliates of a company to sell restricted or control securities. This form provides the SEC with information about the intended sale, allowing the SEC to monitor compliance with federal securities regulations.

Once a seller files Form 144, it indicates that they are preparing to sell a specific number of shares within a specified period. A broker can then proceed with handling the transactions once they receive confirmation that the filing has taken place. This confirmation acts as verification that the seller is compliant with the registration requirements needed for the sale of restricted securities.

In contrast, pre-approval by regulators is not a prerequisite before transactions can occur once Form 144 is filed, nor is it relevant if the seller exceeds investment limits—a situation that would trigger different regulatory concerns outside the context of Form 144. Additionally, while brokers do facilitate these transactions, their involvement is indeed contingent on the proper filing of Form 144. Thus, it is essential for brokers to act only after confirmation of that filing to ensure regulatory compliance and protect all parties involved in the transaction.