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SEC / FINRA / state securities regulators

US SEC adviser and FINRA broker-dealer application process

A practical US application map for SEC investment adviser registration, state adviser/IAR questions, FINRA broker-dealer membership, Form ADV, IARD, Form NMA, CRD, and hybrid models.

Who this helps

  • - US investment adviser and private fund adviser founders
  • - Broker-dealer, placement agent, introducing broker, and transaction-compensation models
  • - Compliance teams deciding between adviser, broker-dealer, state, exempt reporting, or hybrid routes
  • - Individuals preparing IAR, registered representative, principal, or supervisory evidence

Route choice

  • - Decide whether the business gives investment advice, manages funds, solicits clients, receives transaction compensation, executes/introduces securities transactions, handles custody, or combines adviser and broker-dealer functions.
  • - For adviser models, check SEC eligibility, state registration, exempt reporting adviser status, IARD entitlement, Form ADV Part 1, Part 2 brochure, custody, compliance, and books and records.
  • - For broker-dealer models, check FINRA membership, Form NMA, Form BD, CRD, Form U4 for registered persons, supervision, net capital, clearing/custody arrangements, and membership standards.
  • - For hybrid models, document where advice ends and brokerage begins, how compensation works, which entity performs each activity, and which public registers users should check.

Pre-application checks

  • - Build a compensation map before route selection; transaction-based or success-fee compensation is a broker-dealer red flag even where the business calls itself advisory or consulting.
  • - For SEC adviser registration, prepare Form ADV, brochure, compliance policies, custody analysis, chief compliance officer role, state notice filing or registration analysis, and IARD account access.
  • - For FINRA membership, prepare the NMA evidence pack: business lines, personnel, supervisory procedures, systems, capital, clearing/carrying relationships, vendors, AML, and membership interview readiness.
  • - Check individual registration, exam, sponsorship, CRD/IARD, IAR, registered representative, principal, and disciplinary history assumptions before presenting the team as launch-ready.

Application steps

  1. 1. Classify the model: SEC adviser, state adviser, exempt reporting adviser, broker-dealer, capital raising/placement agent, solicitor/marketer, private fund adviser, funding portal, or hybrid.
  2. 2. For adviser registration, establish IARD access, complete Form ADV Part 1 and Part 2, file electronically, and track Registration/Reporting Status.
  3. 3. For broker-dealer membership, reserve the firm name where needed, prepare and submit Form NMA and related forms through FINRA systems, pre-fund fees, file Form U4 for registered persons, and prepare for MAP review/interviews.
  4. 4. Respond to SEC, state, or FINRA questions with corrected filings, updated policies, supervisory evidence, and operating detail.
  5. 5. After approval/effectiveness, verify IAPD, BrokerCheck, Form ADV, firm registration, individual records, and ongoing amendment obligations.

People evidence

  • - Chief compliance officer, supervised persons, investment adviser representatives, registered representatives, principals, operations, finance, AML, supervision, and branch/personnel maps.
  • - Form U4, CRD, exam, sponsorship, disciplinary history, principal qualification, IAR registration, and state registration assumptions by person.
  • - Written supervisory procedures and supervision ownership for broker-dealer activities, including transaction compensation, communications, suitability, AML, books and records, and branch oversight.
  • - Adviser compliance ownership for fiduciary duty, disclosure, custody, conflicts, advertising, solicitation/marketing, books and records, and annual ADV updates.

Entity evidence

  • - Form ADV narrative, brochure, compliance manual, custody memo, marketing/solicitor controls, private fund schedule data, books and records, CCO authority, and state filing map for advisers.
  • - Form NMA business plan, WSPs, AML program, clearing/custody contracts, net capital planning, financials, vendors, systems access, branch/office plan, and registration/exam matrix for broker-dealers.
  • - Entity separation memo for hybrid adviser/broker-dealer models, including compensation flows and client disclosures.
  • - Public-register diligence plan for IAPD, BrokerCheck, state records, CRD, and Form ADV amendments.

Official submission channels

  • - SEC adviser registration and exempt reporting adviser filings through IARD and Form ADV.
  • - FINRA broker-dealer membership through FINRA systems, Form NMA, Form BD, CRD, and related membership review channels.
  • - IAPD and BrokerCheck for public verification after filing, approval, or registration changes.

Timeline and bottlenecks

  • - The SEC generally has 45 days after receipt of Form ADV to declare an adviser registration effective if the filing is complete and proper.
  • - FINRA must process a substantially complete new member application within 180 calendar days, with applicant response deadlines during MAP review.
  • - Common bottlenecks include broker-dealer issues hidden in compensation, unsupported custody analysis, incomplete Form ADV/brochure language, thin supervisory procedures, net capital gaps, and unclear individual registrations.

After approval

  • - Verify adviser status and Form ADV on IAPD, and broker/firm records on BrokerCheck.
  • - Maintain annual ADV amendments, other-than-annual amendments, state filings, Form U4/U5 updates, supervisory records, continuing education, financial filings, AML reviews, and advertising/marketing controls.
  • - For hybrid models, keep public disclosures and client communications aligned with the actual capacity in which the firm or person is acting.

Common mistakes

  • - Assuming investment adviser registration covers transaction-based placement or brokerage activity.
  • - Treating Form ADV as a marketing brochure rather than a regulatory disclosure and operations record.
  • - Underestimating FINRA NMA completeness, membership interview, WSP, net capital, and registered-person evidence.
  • - Ignoring state adviser, IAR, branch, notice filing, or individual registration requirements.

Deep application packs

Disclaimer

Information on LicenseCompare is for general educational purposes only and does not constitute legal, regulatory, financial, tax, investment, or professional advice. Licensing requirements depend on facts and change over time. Always consult official regulator materials and qualified professional advisers.