IAR vs RIA: the person and the firm
The two terms are often swapped, but they name different things. NASAA's guide for investment advisers puts it plainly: the investment adviser firm holds the registration or license, and the investment adviser representative is the individual who performs services on the firm's behalf.
| Registered investment adviser (RIA) | Investment adviser representative (IAR) | |
|---|---|---|
| What it is | A firm | An individual who works for a firm |
| How it registers | Form ADV, with the SEC or a state | Form U4, filed by the firm with the states that require it |
| Regulated by | The SEC or a state securities regulator | State securities regulators, and supervised by the firm |
| Public record | Firm record on the SEC's IAPD | Individual record on IAPD, under a CRD number |
When an advisor changes firms, the firm's registration stays where it is. The advisor's IAR registration ends at the old firm and a new one begins at the new firm.
Who has to register as an IAR?
For an SEC-registered firm, the federal definition decides who counts as an IAR, and the states handle the registration. The SEC's Form ADV glossary adds that IARs of SEC-registered advisers may be required to register in each state in which they have a place of business. A firm registered only with a state may be subject to that state's own definition.
The SEC rule leaves out a supervised person who does not regularly solicit, meet with or otherwise communicate with the firm's clients, and one who provides only impersonal investment advice. The clients it does not count are natural persons who are "qualified clients" under SEC Rule 205-3.
States generally require a passing score on a competency exam or a qualifying professional designation. NASAA describes passing its Series 65 as normally a prerequisite to an IAR license. The Series 66, taken with the SIE and Series 7, counts as passing both the Series 63 and the Series 65.
To check a person, search their name or CRD number on the SEC's IAPD site. The record shows current and past registrations, the firms, exams passed and any disclosures.
Can one advisor hold more than one registration?
Yes. An IAR registration is separate from registration with FINRA as a registered representative of a broker-dealer. Many advisors hold both: they provide advisory services as IARs and handle brokerage business under FINRA's rules.
Where it shows up in our data
Every move Continuum counts is an IAR whose registration ended at one firm and began at another, read daily from the SEC's IAPD records. Our counts are therefore counts of investment adviser representatives (IARs), not of every advisor: broker-only registrations are not in that feed, and the counts include home-office and supervisory staff who hold the registration. How we count moves explains the method, and AdvisorWire shows the moves by firm.
Sources
- Rule textRule 203A-3: Definitions (investment adviser representative) SEC, via eCFR
- Rule textForm ADV: General Instructions and Glossary SEC
- Public recordInvestment Adviser Public Disclosure (IAPD) SEC
- Continuum dataMarket Intelligence methodology Continuum
- ReferenceInvestment Adviser Guide NASAA
- ReferenceExam FAQs (Series 63, 65 and 66) NASAA
Editorial standard: Continuum publishes education for financial advisors. It is general information, not legal, tax, or compliance advice.