A small adviser with less than $25 million of AUM is prohibited from SEC registration if its principal office and place of business are in a state that regulates advisers (currently all states except Wyoming).This test is administered by the Financial Industry Regulatory Authority ( FINRA), a self-regulating, private organization that writes and enforces the rules governing registered brokers and broker-dealer firms in the United States. The first step to becoming a Registered Investment Advisor (RIA) is to pass the Series 65 (Uniform Investment Advisor Law) exam. Usually compensated by a percentage of assets under management, RIAs are legally required to act in a fiduciary capacity for their clients at all times.Applying to become an RIA includes filing a Form ADV, which includes a disclosure document that is also distributed to all clients.RIAs must register with the SEC or state authorities, depending on the amount of money they manage.Registered Investment Advisor (RIA)s-financial professionals who counsel individuals on financial affairs and manage their portfolios-must meet certain legal and professional qualifications.
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