Becoming a financial advisor in Indiana requires you to register your own investment adviser (IA) firm, or to become registered as an investment adviser representative (IAR) of a firm currently operating in Louisiana. The following is a step-by-step explanation of how to register a new firm or register as a representative of an existing firm at either the state level with the Office of Financial Institutions, Securities Division or at the federal level with the Securities & Exchange Commission (SEC).
Your investment adviser firm and its representatives will conduct business in Louisiana in accordance with the Louisiana Securities Act.
Step 1. Get Your Education
Enroll in an appropriate degree program. Almost all successful investment advisers in practice hold a bachelor’s or graduate degree. Very often advisers hold specialized degrees:
- BA-Accounting or BA-Consumer and Family Financial Services
- BS-Accounting
- MS-Accounting, MS-Finance, or MS-Personal Financial Planning
- MBA-Accounting and Finance or MBA-Finance
- PhD-Finance or PhD-Accounting
Take the right classes. Your education should help you develop financial expertise. Should you decide to pursue something besides one of the specialized degrees, you can still prepare yourself by participating in relevant coursework:
- Business communications
- Finance
- Taxes
- Behavior of organizations, groups, and persons
- Quantitative business applications
- Management
- Business ethics
- Statistics
- Managerial and Financial Accounting
- Economics
- Marketing
- Computer-based information systems
- Business law
Consider voluntary certification. It is always wise to find ways to distinguish the qualifications and expertise you have as financial advisor. Earning one of the several professional designations available helps accomplish this. Earning one of these specialized professional certifications will require you to meet recognized eligibility requirements, that include a minimum level of education, usually a bachelor’s degree, or related industry experience. Holding one of these professional designations also makes you exempt from exam requirements while pursuing investment adviser registration:
- Chartered Financial Consultant (ChFC)
- Chartered Financial Analyst (CFA)
- Chartered Investment Counselor (CIC)
- Personal Financial Specialist (PFS)
- Certified Financial Planner (CFP)
Step 2: Register Your Firm in Louisiana
(You will need to complete this step only if you plan to start a new IA firm. If you will start your career by working with a previously established firm, proceed to Step 3.)
Firms with over $100 million in assets under management will be registered at the federal level with the Securities and Exchange Commission (SEC). Those managing less than $100 million will register at the state level with the Louisiana Office of Financial Institutions, Securities Division. Both state and federal level firms will process registration through the Investment Adviser Registration Depository (IARD).
- Complete FINRA’s Entitlement Process. You will need to prepare and submit required Entitlement Forms for a New Investment Adviser Firm and send/fax them to the address/number listed. This process will provide the new firm the authorization needed to access the IARD. As part of the process, your new firm will designate a Super Accountant Administrator (SAA) who will access the FINRA Firm Gateway after Entitlement is approved.
- Fund the IARD to cover registration, filing, and exam fees. The IARD account needs to have enough funding to pay this minimum amount:
- Firms with over $100 million in assets under management will pay an initial filing fee of $225 (fees for state IAs managing less than this are being waived till the end of December 2012)
- The annual filing fee in Louisiana for the IA firm is $150
- The annual filing fee in Louisiana for each IAR is $60
- Complete and submit Form ADV. The form will be completed and submitted electronically in the IARD. Register in Louisiana by selecting Louisiana as the state in which your firm will do most of its business.
- Complete and electronically submit Form U-4, the Uniform Application for Securities Registration or Transfer for all IARs in the firm. If you will operate your firm under a sole proprietorship, you will be considered a representative of the firm. This requires you to submit Form U-4 for yourself.
- Submit financial statements directly to the Louisiana Securities Division at Post Office Box 94095, Baton Rouge, LA 70804-9095.
Step 3: Get Your Registered Investment Adviser License in Louisiana by Taking the Required Exam
The Louisiana Office of Financial Institutions, Securities Division and the Securities and Exchange Commission (SEC) waive exam requirements for applicants that hold one of these professional designations:
- Chartered Financial Consultant (ChFC)
- Chartered Financial Analyst (CFA)
- Chartered Investment Counselor (CIC)
- Personal Financial Specialist (PFS)
- Certified Financial Planner (CFP)
- Register for the required exams. Alabama requires IAR candidates to take the following:
OR
- The Series 7, General Securities Representative Examination, in combination with the Series 66, Uniform Combined State Law Examination, the latter of which requires firm sponsorship.
Register:
- Form U-4, Uniform Application for Securities Industry Registration or Transfer, can be completed and submitted through IARD. Form U-4 will function both as an exam application and the registration application.
- After your exam application is approved, you will receive specific instructions to complete your exam registration. Schedule your exam through one of Louisiana’s Pearson Professional Centers or Prometric testing sites (Alexandria, Baton Rouge, Bossier City, Metairie). You must schedule within 120 days of your Form U-4 being approved.
- Plan to be at the test location at least one hour before the scheduled exam time.
- Immediately after completing the exam, you will be presented with your test score.
Step 4: Ongoing Renewal and Update Requirements in Louisiana
Investment Advisor Firm:
The Investment Adviser Registration Depository (IARD) is used for all annual registration renewals for both IA firms and IARs. All license renewal actions must be finished by December 31st each year, at which time you are also required to make annual updates to Form ADV to show any changes to fee structure. Expect the following fees to apply during each renewal:
- Louisiana’s renewal fees are $150 per year for an IA firm and $60 per year for each IAR in the firm
- Renewal fees must also be paid for all other states in which the IA and its IARs do business
- There is a $100 administrative fee that is paid directly to the IARD each year as a part of the renewal process
Investment Adviser Representatives:
All IARs are required to provide updated and accurate information on their Form U-4. As a sole proprietor, you will have to make any required changes or updates to Form U-4 yourself as needed.
As an employee of an IA firm, you will submit all changes to the Form U-4 through your firm’s Super Account Administrator. All required amendments must be done no later than 30 days after any of the following information changes:
- Name changes or any reason, including marriage
- Change of residence address
- Entry of a civil judgment
- Changes of jurisdiction
- Completion of additional education
- Disciplinary actions
- Customer complaint
- Completion of additional certifications
- Any additional business activities
- Changes to your criminal record