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Retirement Planning > Social Security

Caution still merited when discussing securities

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According to published sources, agents and securities representatives in Iowa may get clear guidance on what they can say about securities or insurance products they are unlicensed to sell while discussing products they are licensed to sell.

The issue of selling securities (or insurance) without a license is a long-standing issue for both agents and brokers. If the Iowa action provides the guidance both sides are looking for, it may well become a workable model for other states.

Until that time, you should continue to avoid “red-flag” practices that spark regulatory scrutiny. According to Senior Market Sales, Inc., these include:

  • Recommending the liquidation of a security to generate money to purchase a non-registered life or annuity product.
  • Advising a client about the pluses and minuses of retaining a security versus purchasing an insurance product.
  • Advising a client on how to allocate funds across different asset classes.
  • Emphasizing the high risks of investing in equities.
  • Helping a client with paperwork needed to sell a security.
  • Calling yourself an “investment advisor” when in fact you hold no such a license.
  • Using misleading professional designations.
  • Describing indexed annuities as investments.

As with all things compliance, discretion is the better part of wisdom. If you give unlicensed investment advice, you’re only asking for trouble. Stay within the purview of your license until your state regulator provides guidance otherwise.


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