When Do You Have to Register as an Investment Adviser?

When Do You Have to Register as an Investment Adviser?

The Investment Advisers Act of 1940 defines an investment adviser as any person who, for compensation, engages in the business of advising others as too the value of securities or the advisability of investing in securities or, as part of regular business, issues analyses or reports concerning securities.

Any person who is considered an investment adviser will be subject to the Investment Adviser Act of 1940 and be required to register with either the SEC or the States. A person would be considered an investment adviser if they engaged in these three activities:

  • Provides investment advice, reports, or analysis with respect to securities;
  • Is in the business of providing advice or analysis; and
  • Receives compensation, directly or indirectly, for these services.

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