Bond Typically refers to a long-term promissory note in which the issuer agrees to pay the owner a specific interest rate at regular intervals and then pay the face value on a set future date.
Branch Office Any location identified by any means to the public or clients as a location at which an investment adviser firm conducts business. For purposes of the Investment Adviser Public Disclosure system and its reports: (1) any branch office listed is currently active/open for business; (2) a firm may have multiple branch offices; and (3) an investment adviser representative may be located (i.e., conduct business) at more than one branch office.
Clearing Firm An organization affiliated with exchanges that completes securities transactions by taking care of validation, delivery and settlement. Clearing firms help ensure that executed trades are settled efficiently and within a specified time period.
Corporation The most common form of business organization, it is chartered by a state and given many legal rights as an entity separate from its owners.
Central Registration Depository (CRD®) An online computerized system which maintains the employment, qualification and disciplinary histories of brokers and brokerage firms that deal with the public.
CRD Number A unique number assigned to brokers and brokerage firms as part of their registration application.
Custody An investment adviser firm has custody if it directly or indirectly holds client funds or securities, has any authority to obtain possession of them, or has the ability to appropriate them.
Customer Dispute A consumer-initiated complaint or investment-related arbitration proceeding brought against an investment adviser representative or investment adviser firm alleging sales practice violations, forgery, theft or misappropriation of funds.
Disclosure Event An occurrence required to be reported as part of the state(s) licensing and registration process for investment adviser firms and investment adviser representatives. These events include criminal, regulatory and civil actions, as well as certain financial incidents.
Employment History The information reported by the investment adviser representative on all jobs the adviser has held in the last 10 years both in, and outside of, the investment adviser industry (this may include periods of unemployment and education).
Exams The following are the qualification examinations displayed in the Investment Adviser Public Disclosure system:
- Uniform Combined State Law Examination (Series 66) [North American Securities Administrators Association] The Series 66 is designed to qualify candidates as both securities agents and investment adviser representatives. The Series 7 is a co-requisite exam that needs to be successfully completed in addition to the Series 66 exam before a candidate can register with a state. For more information, see NASAA’s Exams page.
- Uniform Investment Adviser Law Examination (Series 65) [North American Securities Administrators Association] The Series 65 is designed to qualify candidates as investment adviser representatives. For more information, see NASAA’s Exams page.
- Uniform Securities Agent State Law Examination (Series 63) [North American Securities Administrators Association] The Series 63 exam is designed to qualify candidates as securities agents. The examination covers the principles of state securities regulation reflected in the Uniform Securities Act. For more information, see NASAA’s Exams page.
Fiduciary Duty The anti-fraud provisions of the federal Investment Advisers Act of 1940 and most state laws impose a duty on investment advisers to act as fiduciaries in dealing with their clients. This means the adviser must hold the client’s interest above its own in all matters.
Form ADV (Uniform Application for Investment Adviser Registration) Investment adviser firms file Form ADV to register their firm with the SEC and/or state jurisdictions.
Form ADV-W (Uniform Request for Investment Adviser Withdrawal) Investment adviser firms file Form ADV-W to withdraw or terminate their firm’s registration with the SEC and/or state jurisdictions.
Form U4 (Uniform Application for Securities Registration or Transfer) Investment adviser firms file Form U4 to register their investment adviser representatives with the states.
Form U5 (Uniform Termination Notice for Security Industry Registration) Investment adviser firms file Form U5 to terminate an investment adviser representative’s registration with the states.
Form U6 (The Uniform Disciplinary Action Reporting Form) States use this form to report disciplinary actions against an investment adviser firm or investment adviser representative.
Home State The state in which an investment adviser maintains its principal office and place of business.
Inactive A status indicating that an investment adviser firm or investment adviser representative does not currently have an effective registration. An inactive status typically results when an investment adviser firm or investment adviser representative has not completed a registration requirement.
Indirect Owner A person who has the power to indirectly influence the management or policies of an investment adviser firm, whether through ownership of securities, by contract, or otherwise.
Investigation A disclosure event that may include inquiries before a grand jury or regulatory authority (i.e., a state, U.S. Securities and Exchange Commission or a self regulator).
Investment Adviser Public Disclosure A computer system which utilizes the employment, qualification and disciplinary histories of investment adviser representatives contained in the Investment Adviser Registration Depository (IARD) to provide information to the public.
Investment Adviser Representative An individual who provides advice to others about investments for a fee and who is required by most states to register or become licensed.
Judgment A court’s final determination of the rights and obligations of the parties involved in a court proceeding.
Lien A legal right or interest that a creditor has in another’s property, usually lasting until the debt or duty that it secures is satisfied.
Limited Liability Company (LLC) A type of company deliberately formed (consistent with state laws) to provide its owners and managers with limited liability and certain tax benefits. .
Organization Affiliates A person (may be a natural person or an entity) named on a Form ADV as a control person that either:
• directly or indirectly controls,
• is under common control with,
• or is controlled by the firm, including any current employees who perform executive duties or have senior policy making authority.
Partnership A type of unincorporated business organization in which multiple individuals manage the business, share in the profits (or losses) of the undertaking, and are responsible for its debts and liabilities. Partnerships typically are governed by agreements that establish the extent of each partner’s responsibilities and/or liabilities.
Registration Category A designation of the type of work an investment adviser firm or an investment adviser representative is licensed to perform. .
SEC Number A unique identification number assigned to an investment adviser firm by the Securities and Exchange Commission.
Security A type of investment issued by a corporation, government or other organization that offers evidence of debt or equity.
Sole Proprietorship A business fully owned and run by one person.
State Securities and/or Investment Adviser Authority The securities and/or investment adviser commission (or any agency or office performing a similar function) of any state of the United States, the District of Columbia, Puerto Rico, the Virgin Islands or any other possession of the United States.
Succession History An investment adviser firm’s record of the acquisition, ownership and right to manage another firm’s assets and liabilities.
Suspended A status indicating that an investment adviser firm or an investment adviser representative has been precluded from engaging in the investment adviser, investment banking or securities business generally or from engaging in a particular function (e.g., supervising others), usually as a result of a regulatory action.