Rules and Regulations Archives

NASAA Reveals Top Investor Threats for 2022

Posted on April 22, 2022 by admin

On January 10, 2022 the North American Securities Administrators Association (NASAA) released its annual list of top investor threats for 2022 and urged caution before purchasing popular and volatile unregulated investments – especially those involving cryptocurrency and digital assets. NASAA also announced guidance for investors, including steps to take to protect from fraud in the new year. “The most common telltale sign of an investment scam is an offer of guaranteed high returns with no risk. It is important for investors to understand what they are investing in and with whom they are investing,” said Melanie Senter Lubin, NASAA President Read more about NASAA Reveals Top Investor Threats for 2022[…]

2022 & 2023 Continuing Education Requirements for IARs

Posted on April 8, 2022 by admin

In November of 2020, the North American Securities Administrators Association (“NASAA”) adopted a new rule (PDF) that will require Investment Advisor Representatives (“IARs”) to complete 12 credit hours of Continuing Education annually, 6 for IAR Ethics and Professional Responsibility Requirements and 6 for IAR Products and Practice Requirements. This will be the first time IARs have been subject to Continuing Education requirements and as NASAA president Lisa A. Hopkins states, is intended to “promote heightened regulatory compliance while also helping investment adviser representatives better serve their clients by remaining knowledgeable of current regulatory requirements and best practices.” 2022 IAR CE Read more about 2022 & 2023 Continuing Education Requirements for IARs[…]

Requirements for State Registered Advisers

Posted on May 10, 2021 by admin

Also, State registered advisers should review and verify compliance with state regulatory requirements governing the business of investment advisers. The regulation of investment advisers can vary significantly from one state to the other. Attempts to unify the patchwork of state requirements have fallen short, and the only sure way to determine the specific requirements of a state is to refer directly to the state’s securities laws and regulations, which many states make available online. Due to the practical difficulty of identifying and keeping current on the requirements of each state in which an investment adviser conducts business, it is often advantageous for an investment adviser to adopt a policy that requires it to comply with all state requirements.

Provided below is a non-exhaustive list of common regulatory requirements that states impose on investment advisers. Any investment adviser that does not comply with a particular requirement should thoroughly document its basis for believing that the requirement does not apply in the states in which it conducts business.

For information on investment adviser registration in each state, check out NASAA’s State Investment Adviser Registration Information.

Agent Registration Process

Posted on April 23, 2021April 30, 2021 by admin

Form ADV Part 2B: Disclosures for Supervised Persons

Posted on April 16, 2021 by admin

Form ADV Part 2B is a brochure supplement that must contain certain information about specific individuals, acting on behalf of the investment adviser, who actually provide the investment advice and interact with the client. The brochure supplement is also a narrative format in plain English and includes six required disclosure categories, with a seventh for advisers registered or are registering with one or more state securities authorities:

Registering as an Agent for a Broker-Dealer

Posted on April 14, 2021April 29, 2021 by admin

The USA defines an agent as any individual who represents a broker-dealer or an issuer in effecting or attempting to effect transactions in securities for their clients. Agents are individuals in a sales capacity who represent broker-dealers or issuers of securities. As agents, they act, usually on commission basis, on behalf of others. Agents are often referred to as registered representatives, whether sell registered securities or securities exempt from registration. The use of the term individual here is important. Only an individual, or a natural person, can be an agent. A corporation such as a brokerage firm is not a natural person, it is a legal entity. The brokerage firm is the legal person, or legal entity, the agent, a natural person, represents in securities transactions.