11.3 Investment Adviser Representative Registration
Investment adviser representatives are natural persons who act on behalf of the advisory firm. Licensing occurs strictly at the state level via Form U4.
Key NASAA Exam Takeaways
- An Investment Adviser Representative (IAR) is any partner, officer, director, or employee who provides investment advice, manages client accounts, or solicits advisory services.
- IARs are registered ONLY at the state level (the SEC never registers individuals).
- For a State-Registered Adviser: The IAR must register in every state where they have a place of business OR more than 5 retail clients.
- For a Federal Covered Adviser: The IAR registers ONLY in states where the IAR maintains a physical 'place of business'.
- Termination Notification: If an IAR leaves a State Adviser, the IA firm must promptly notify the Administrator; if leaving a Federal Covered Adviser, the IAR themselves must notify the Administrator.
Knowledge Checkpoint • Section 11.3
An Investment Adviser Representative (IAR) employed by an SEC-registered Federal Covered Adviser has 25 retail clients in State B, but maintains no physical office or place of business in State B. Is the IAR required to register in State B?