RIA Startup

Full Service Investment Adviser Registration

The professional staff at Securities Compliance Management (“SCM”) has the expertise necessary to effectively organize your investment adviser registration. SCM registers advisory firms with the SEC or states as required, and provides the following:

  • Initial consultation;
  • Preparation and filing of Form ADV Part I and all applicable schedules through IARD;
  • Preparation of Form ADV Part II or an equivalent document for use as your client brochure;
  • Registration of all investment advisory representatives through IARD;
  • Preparation and submission of all additional documents required by regulators;
  • Customized Compliance and Supervisory Manuals;
  • Customized Codes of Ethics; and
  • Training.
  • The Switch from SEC to State Registration for Investment Advisers with Less than $100 Million of Assets under Management

    The eligibility for registration as an investment adviser with the U.S. Securities and Exchange Commission (“SEC”) based upon the amount of assets under management will increase from the current minimum threshold of $25 million to a new threshold of $100 million pursuant to the Dodd-Frank Financial Reform Act, which passed on July 21, 2010. The Dodd-Frank Financial Reform Act included a provision affecting registered investment advisers eligible for SEC registration based upon the amount of assets under management and requiring that registered investment advisers with less than $100 million in assets under management register with state securities regulators rather than the SEC. It is estimated that as a result of this increased eligibility threshold, over 4,000 investment advisers currently registered with the SEC will need to register with the state securities regulator for each state where the investment adviser firm conducts investment advisory business and does not meet an exemption from the investment adviser registration requirements in that state.

    The Dodd-Frank Financial Reform Act also changed the multi-state investment adviser registration exemption. Currently, a registered investment adviser is eligible to register with the SEC as a multi-state investment adviser if the investment adviser is required to register with the state securities regulator of 30 or more states regardless of the investment adviser’s total assets under management. The Dodd-Frank Financial Reform Act has decreased the multi-state investment adviser threshold to allow investment advisers to register with the SEC if the investment adviser is required to register with the state securities regulator of 15 or more states. It is important to note that the multi-state investment adviser eligibility is based upon the requirement to register in 15 or more states, which registration requirement is generally triggered upon the investment adviser having an office location or having more than 5 clients in a state. In other words, an investment adviser is not eligible for registration with the SEC as a multi-state investment adviser unless the investment adviser has either an office location or more than five clients in 15 or more states. (It is important to note that some state securities regulators may require investment adviser registration with less than 5 clients regardless of whether the investment adviser has a place of business in the state. It is important to check a state securities regulator’s investment adviser registration requirements prior to obtaining clients in that state.)

    While the compliance date of July 21, 2011 has been announced, not every detail has been worked out with the switch. Currently the North American Securities Administration Association (“NASAA”) and the SEC are working together to determine when investment advisers who are currently registered with the SEC can switch to state investment adviser registration, and whether those investment advisers will have to pay multiple investment adviser registration fees.