Series 63: 1.1.2.2 The Investment Adviser Registration Process

Taken from our Series 63 Online Guide

1.1.2.2  The Investment Adviser Registration Process

To register at the state level as an investment adviser, persons must file the appropriate paperwork with the state through the federally run Investment Adviser Registration Depository system, or IARD. To register, an investment adviser must use this system to submit a Form ADV. Some states may require the filing of additional forms such as advisory contracts and financial statements as well.

The applicant must also give permission for the administrator to perform an appropriate background check and sign a consent to service of process, which allows the administrator to receive legal papers (summons, notice of lawsuits, etc.) on behalf of the adviser. Once the consent to service of process is filed, it does not need to be renewed.

Part 1 of Form ADV (which is short for Adviser) includes general information about the investment adviser such as:

Information about the ownership and nature of their practice including the names of the principals involved

The location of the main office

The types of services offered

Whether the adviser keeps custody of customer assets

The location of books and records

Any relevant regulatory/disciplinary history

Part 2A of Form ADV includes information relevant to the firm’s clients, such as:

• Fees or fee structure for the services provided

• Types of clients and investments

• Methods of analyzing investments (e.g., technical versus fundamental)

• The educational and business background of the advisers.

Part 2B of Form ADV provides specific information about the educational background, employment qualifications, disciplinary history, other business activities, and additional sources of compensation for any registered person who will be working with a client.

Part

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