Definition: FINRA Rule 1220 defines a representative as a person associated with a member firm, including assistant officers other than principals, engaged in its investment banking or securities business. That business includes supervision, solicitation, conduct of securities business and training persons for those functions; a registered representative is registered with FINRA through the member broker-dealer.

Who has to register?

FINRA Rule 1210 requires each person engaged in the investment banking or securities business of a member to be registered with FINRA as a representative or principal in each category appropriate to their functions and responsibilities, unless an exemption in Rule 1230 applies. The member firm files Form U4 for the individual.

Under FINRA Rule 1220, a general securities representative registering after October 1, 2018 must pass the Securities Industry Essentials (SIE) exam and the General Securities Representative qualification exam, the Series 7.

Registered representative vs IAR

Registration as a registered representative under FINRA's rules covers brokerage business at a broker-dealer. Advisory work for an investment adviser needs a separate registration as an investment adviser representative when the federal or state definition covers the person. Many advisors hold both.

Under FINRA Rule 3110, a registered representative is supervised by the broker-dealer, and FINRA publishes the registration record on BrokerCheck.

Where it shows up in our data

Continuum's movement data counts investment adviser representatives (IARs) from the SEC's IAPD records. Advisors registered only with a broker-dealer are not in that feed, so a broker-only move does not appear in our counts. Methodology states this limit, and Advisor Channel Flow repeats it beside its figures.

Sources

  1. Rule textFINRA Rule 1220 (Registration Categories) FINRA
  2. Rule textFINRA Rule 1210 (Registration Requirements) FINRA
  3. Rule textFINRA Rule 3110 (Supervision) FINRA
  4. Public recordBrokerCheck FINRA
  5. Continuum dataMarket Intelligence methodology Continuum

Editorial standard: Continuum publishes education for financial advisors. It is general information, not legal, tax, or compliance advice.