what does it mean for a company to be registered with sec
Many financial scams involve unlicensed individuals selling unregistered investments—ranging from stocks, bonds, and oil or gas deals to fictitious instruments, such equally prime depository financial institution investments. That's why information technology is particularly of import to "Ask and Check" about investments and investment professionals earlier yous invest. Regardless of your trust or ties, or prior dealings with the professional, practise your homework.
Check Out the Seller
If a salesperson is trying to sell you an investment, check them out by following these steps.
Pace i: Ask "Are you licensed to sell me this investment?"
Legitimate investment professionals—including registered financial professionals (likewise known as registered representatives), investment advisers and insurance agents—must exist licensed with the Financial Manufacture Regulatory Authority (FINRA), the Securities and Exchange Commission (SEC) or your state securities or insurance regulator before they can sell you annihilation. If they say they aren't licensed, say good bye—and don't buy.
Step two: Check.
If they say they are licensed, check them out equally follows:
| If They Say They Are a ... | Expect Here | Helpful Hints |
|---|---|---|
| Registered Fiscal Professional |
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| Investment Adviser |
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| Insurance Amanuensis |
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FINRA BrokerCheck Tips
Here are some helpful tips when checking out a salesperson using FINRA BrokerCheck:
How to search BrokerCheck: You may search for a person by name, CRD/SEC Number, employing firm or nix code.
If your Search returns likewise many results: You tin can narrow the search results you lot get by adding i or more of the search criteria noted above.
If you don't observe the person in FINRA BrokerCheck (your search comes dorsum as "No Search Results"), it can mean:
- The person'south proper name is misspelled. You can refine your search past entering only office of the person's name.
- The private is non included in BrokerCheck or the Securities and Exchange Commission's Investment Adviser Public Disclosure database because he or she:
- is not currently registered with FINRA or a state securities regulator, or has not been so registered inside the last x years; or
- has non been registered with FINRA or a state securities regulator inside the last ten years and either:
- is non the field of study of a concluding regulatory action;
- has not been convicted of or pled guilty or no contest to certain crimes;
- has not been subject to a civil injunction involving investment-related activeness or been found in a ceremonious court to accept been involved in a violation of investment-related statutes or regulations; or
- has not been named as a respondent or defendant in an arbitration or civil litigation in which he or she was alleged to have committed a sales practice violation, and which resulted in an laurels or civil judgment against the private.
- The investment adviser firm is not within scope for the Securities and Exchange Commission's Investment Adviser Public Disclosure database because the firm is not currently registered with the SEC and/or a land securities regulator or been and then registered inside the last 10 years.
If yous are still not able to notice the person yous're searching for, please telephone call the FINRA BrokerCheck Hotline at (800) 289-9999 and speak with a representative.
Check Out the Investment: Is It Registered with the SEC?
Take these steps to check whether a recommended investment is registered with the Securities and Exchange Commission (SEC):
Step 1: Ask the person offering the investment, "Is this investment registered with the SEC?"
If the respond is no, inquire why the investment is not registered. Not all securities offerings must be registered with the SEC—such as those issued by municipal, country and federal governments. The SEC likewise provides exemptions for sure intrastate offerings and modest public and private offerings under a rule known equally Regulation D. For more than information, read the SEC'southward Microcap Stock: A Guide for Investors.
Step 2: If yes, and so use the chart below to help you check that this is in fact the case.
| Where to Bank check | What You Get | Helpful Hints |
|---|---|---|
| SEC—EDGAR Company Search Phone call the SEC's Role of Investor Education and Advocacy toll-free at (800) SEC-0330 if you lot have problem using EDGAR or have questions about a company or investment. |
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| Your State Securities Regulator |
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Continue in mind that registration with the SEC does non guarantee that an investment volition exist a good 1 or immune to fraud. Likewise, lack of registration does non mean the investment lacks legitimacy. The critical difference is the extreme level of risk you assume when you invest in a company about which little or no information is publicly available. SEC registration carries a number of advantages for investors, including disclosure of financial and other information that tin can help investors assess whether to invest in a company'south securities.
To check out the registration of the following types of investments, follow these steps:
| Mutual Funds | Visit the SEC's EDGAR Mutual Fund Search. If you find the mutual fund there, so it is registered with the SEC. |
| Variable Annuities Variable Insurance Products | Visit the SEC's EDGAR Variable Insurance Product Search. If you find your variable annuity or other insurance production, then information technology is registered with the SEC. |
| Exchange-Traded Funds (ETFs) Substitution-Traded Notes (ETNs) Closed-end Funds | Visit FINRA Market Data. Click on the link that says Company Data in the far left column to search for your investment. If you observe the ETF, ETN or airtight-end fund on Market place Data, information technology is registered with the SEC. |
Source: https://www.finra.org/investors/protect-your-money/ask-and-check
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