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How do I find out whether an investment advisor has ever had problems with a government regulator or has been disciplined?
Most investment advisors must fill out a form called "Form ADV." They must file their ADVs with either the SEC or the state securities agency in the state where they have their principal place of business, depending on the amount of assets they manage.
The ADV consists of two parts. Part I contains information about the advisor's education, business, and whether they've had disciplinary problems with regulators or clients. Part II outlines the adviser's services, fees, and strategies. Before you hire someone to be your investment advisor, always ask for, and carefully read, both parts of the ADV.
You can get copies of Part I of Form ADV filed by SEC registered advisors through the Investment Advisers Public Disclosure (IAPD). All information filed by advisors on Part I of the Form ADV is available on IAPD except for social security numbers, certain home addresses, and contact employee information. Currently, Part I information also is available on IAPD for some, but not all, state registered advisors.
You can check on a state adviser's regulatory information by contacting the appropriate state securities regulator. Ask your state securities regulator whether they've had any complaints about the advisor, and ask them to check the CRD.
If the SEC registers the investment adviser, you can get Part I of the Form ADV (as well as an historical ADV) from the SEC by mail. |
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