More On Legal & Compliancefrom The Advisor's Professional Library
- Differences Between State and SEC Regulation of Investment Advisors States may impose licensing or registration requirements on IARs doing business in their jurisdiction, even if the IAR works for an SEC-registered firm. States may investigate and prosecute fraud by any IAR in their jurisdiction, even if the individual works for an SEC-registered firm.
- Client Communication and Miscommunication RIA policies and procedures must specify what type of communications should be retained. The safest course of action is for RIAs to retain all communicationsto clients, from clients, and about client accounts. To comply with fiduciary obligations, communications must be thorough and not mislead.
After the Minnesota Department of Commerce Securities Unit announced it would waive requirements that investment advisor representatives (IARs) who were employed as of Aug. 1 have a Series 65 or 66 license, FSI released a statement calling the move a “regulatory victory” for IARs.
Advisors who are already working can register in Minnesota without taking an exam. IARs who were not working before Aug. 1 will have to sit for the exam to register with the state, but they’ll have a grace period between Nov. 1 and the end of January to register.
FSI noted that it had met with the department to offer guidance on how best to implement the licensing requirement. “FSI members demonstrated that IARs who were providing investment advice in Minnesota prior to the requirement are well qualified by virtue of their experience and encouraged the department to waive the exam requirement for existing IARs and those with certain designations,” according to FSI.
“We appreciate the department’s willingness to work with us and our members and for its careful consideration of our comments and input,” the agency continued in its statement. “This is yet another example of how collaboration between regulators, the industry and investors leads to efficient solutions for all parties.”
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