What You Should Know About the Registration Process for Investment Advisors

As many of you may be aware that in order to practice as the financial consultant dealing with investments, you require an appropriate investment adviser registration. Those who are going to apply for such registrations in the coming times should know about the significant variances related to investment adviser regulation. These variations are with respect to US SEC and securities regulators at state level. So, for those who want to know, what does investment adviser signify? It signifies an entity or individual providing analysis or advice through indirect/threat recommendations related to securities markets or securities.

They also provide regular advice related to securities to their clients and a Registered Investment Advisor (RIA) is allowed to practice in such capacities by the laws of the state and country. However, it is wrong to think that any firm providing solutions related to investment advisory should register as such. SEC has given a breather to comment professions where investment advisory is just a part of a comprehensive bouquet of services. This includes lawyers, broker-dealers, publishers bona fide, banks, accountants, teachers, securities advisers to government, and engineers.

Other exemptions from such registrations include church plans, charitable organizations, and officials. While this way, many firms will be able to do away with SEC registration they will still need to follow investment adviser, compliance regulations related to state level registration. The best people to provide advice whether you require the registration are attorneys and compliance professionals. They will be able to thoroughly consider your situation and give the right advice. Assets under Management (AUM) typically determine your registration requirements.

So, how does the registration process works and what you need to do in order to go for this successfully! Individual wishing to function as investment advisers most of the time tend to establish relevant entities as liability limited company or corporation. After this, they serve as Investment Advice Representatives (IAR) for their firms. However, those who wish can also become sole proprietors as investment advisor. Tax professionals and legal counsel will be able to offer relevant consultation to help you decide whether you should go for establishment of entity and the type thereof.

It is important to note that irrespective of whether you entity is established yet or not it is possible to start your registration process as an investment advisor. Go through any investment adviser compliance manual and you will be able to know that it is crucial to establish your entity before filing the application. Once you apply for the same, both SEC and state regulatory bodies take approximately 30-45 days for denial or approval. However, it may also take longer based upon different circumstances and factors. Incomplete applications have been found to be the biggest culprit in this regard.

Another thing to know about the registration is of course its timely renewal to keep your firm viable. Both notice filing and registrations expire annually on calendar basis so go for renewals in accordance.

Those, who want to know more about registration of investment advisers and the various requirements thereof should visit the website NCSOnline.com.

About the Author

Tom Mason works is an investment banker by profession. He also offers consultancy on various investment related topics through the various articles that he writes and shares online and other online forums. He specializes in investment adviser registration services amongst others.