Investment Adviser Representative Continuing Education (IAR CE)
On May 1, 2024, the Department’s IAR CE rulemaking file was approved by the Office of Administrative Law and filed with the Secretary of State, and became effective immediately. The IAR CE regulation requires that IARs complete twelve credits of continuing education annually, with six credits focused on Products and Practice and six credits focused on Ethics and Professional Responsibility. The 2024 compliance period runs from May 1, 2024 to December 31, 2024. Credits earned at any time in 2024 will be accepted and count toward 2024 compliance.
The final text of the regulation and the final statement of reasons are posted on the Department’s website and available here.
FREQUENTLY ASKED QUESTIONS:
INVESTMENT ADVISER REPRESENTATIVE CONTINUING EDUCATION
Who must comply with the IAR CE requirements?
Every IAR registered in California must comply with IAR CE requirements. The program applies to all registered IARs of both state-registered and federal-covered investment advisers.
When do IARs need to begin complying with the IAR CE requirements?
IARs registered in California on or before May 1, 2024, must begin taking CE courses in 2024, and obtain the required 12 credits by December 31, 2024. Credits earned at any time in 2024 will be accepted and count toward 2024 compliance.
When an individual registers for the first time as an IAR, they will not be subject to the CE requirements until the next calendar year. Similarly, if an IAR is registered only in states without a CE requirement and becomes registered in a CE state for the first time, that IAR will not need to comply with those CE requirements until the next calendar year. For example, if an IAR has not been registered in any states requiring CE and registers in California in 2024, that IAR will begin complying with the CE rules in 2025. However, IARs who are already registered in an IAR CE state prior to registering in California must continue to complete their CE credit schedule for that calendar year. See also “What if an IAR is registered in more than one state?” below.
How many credits/hours are required?
Beginning in 2024, IARs will need to obtain 12 CE credits each year to maintain their IAR registration. A “credit” is a unit designated by NASAA to be at least 50 minutes of educational instruction. Some courses offer more than one credit depending on the length of the course. Generally, the provider’s course description will identify the number of credits available for completing the course.
The 12 credits must include:
• six credits of Products and Practices and
• six credits of Ethics and Professional Responsibility
Generally speaking, an IAR cannot receive credit more than once for the same course and must take care to avoid duplicate courses in subsequent years. (An exception to this is a course that is updated and receives a new course number.)
Where can IARs find a list of the approved course providers?
To obtain credit, courses must be approved for the CE program. A list of approved providers can be found on the NASAA website.
What if an IAR is registered in more than one state?
An IAR registered in more than one state must comply with the requirements of each state securities regulator. However, in California, an IAR is considered in compliance with the CE requirements as long as both of the following are met:
- The Investment Adviser Representative’s Home State has continuing education requirements that are the same as the requirements in CA Rule 260.236.2 subdivisions (b)(l) and (b)(2).
- The Investment Adviser Representative is in compliance with the Home State’s Investment Adviser Representative continuing education requirements.
If an IAR already maintains CE credits for certain professional designations, can those be used to fulfill California’s IAR CE requirements?
Yes, credits from CE courses taken to maintain professional designations can apply to the IAR CE program so long as the provider and course have been approved through Prometric for IAR CE purposes. Providers will likely promote the fact that certain courses qualify for IAR CE so IARs can look for courses that meet the CE requirements for both IAR CE and their professional designations.
NASAA list of providers includes those that are known to offer courses approved for both IAR CE and a professional designation.
Who is responsible for reporting IAR CE credits and how are the IAR CE credits reported?
The Authorized Provider will report to CRD a roster of IARs that successfully completed the course. Each IAR is responsible for ensuring that the Authorized Provider reports the IAR’s completion of the applicable IAR CE Credit.
How to track and monitor the progress of IAR CE courses?
A Financial Professional Gateway (FinPro)account is the only way that representatives can monitor their CE requirement progress and fulfillment for themselves.
Go to https://www.finra.org/registration-exams-ce/finpro to create an account.
Please see the User Guide and Video Tutorial for help setting up your account.
For dually registered IARs, can the CE required by FINRA for broker-dealer agents be used to fulfill any of the CE requirements for IARs?
Yes, an IAR who is also a registered broker-dealer agent and who complies with FINRA’s CE requirements is considered to be in compliance with the requirement to report six credits of Products and Practices content, so long as the FINRA CE content continues to meet certain baseline criteria as determined by NASAA and payment is made in CRD of a $3 per credit reporting fee. Please note, you must speak with your broker-dealer to determine if they want to report it on your behalf or if you should self-report your completion through FinPro and pay the applicable reporting fee of $18 ($3 per credit hour times six credits). To self-report the completion, you will need to log in to FinPro and scroll to the “Continuing Education” section where you should see a header for IAR CE. Next to your “Incomplete” status, click the “Apply Regulatory Element Credit” link and follow the prompts to pay the reporting fee. Please note, there will be no refunds. In addition, if for any reason your reporting fee payment is not processed or is charged back you will not receive the corresponding IAR CE credits.
What happens if an IAR does not complete the CE requirements in a timely manner?
If an IAR does not complete the CE requirement by the annual deadline, the IAR will pay the registration renewal fee and CRD will set their IAR CE status to “CE Inactive.” Current CE status will also appear in the Investment Adviser Public Disclosure (IAPD) and BrokerCheck. The IAR can continue to do business, however, if CE is not completed by the end of the second year, the IAR will be unable to renew their registration and it will be terminated for failing to complete CE.
I terminated my registration in the state requiring IAR CE. Why is the IAR CE still required on my registration?
Termination of an IAR registration from a state requiring CE does not remove the requirement. IAR CE requirements are maintained if an IAR has been registered with a state that requires IAR CE for any part of the year. The requirement continues to exist and may affect future registrations in IAR CE states.
This is true beyond the current reporting year. The IAR should remain current on their IAR CE requirements to ensure that future state registrations aren’t impacted. An IAR CE deficiency will not impact state registrations in states that haven’t adopted the rule. However, if that state adopts the requirement in the future, the IAR’s registration will be impacted on the rule’s effective date if the IAR hasn’t maintained the requirement.
How does the IAR CE Status impact an IAR Registration Status and what does each status mean?
|
IAR CE Status |
IAR CE Registration Status |
Meaning |
|
IAR CE Not Required |
Approved |
The individual does not have an IAR CE requirement to fulfill this year. |
|
IAR CE Required |
Approved |
The individual has an IAR CE requirement to fulfill this year. |
|
IAR CE Satisfied |
Approved |
The individual has satisfied the IAR CE requirement for this year and is current on their IAR CE obligations. |
|
IAR CE Inactive |
Approved-Pending IAR CE |
The individual did not complete their IAR CE requirements for the previous year. |
|
IAR CE Fail to Renew |
Terminated-No IAR CE |
The individual did not complete their IAR CE requirements for the previous two years, causing the individual’s IAR registration(s) for which there is a CE obligation to be administratively terminated. To reactivate the impacted IAR registration(s), the individual must make up the required CE or re-qualify by examination and then reapply for registration. |
Will my CE Status be available for the public to view?
An IAR’s current CE Status will be available for public viewing on FINRA’s BrokerCheck and on the Investment Adviser’s Public Disclosure (IAPD) webpage.
Additional Resources on IAR CE:
If you have additional questions, please visit NASAA’s IAR CE webpage for their full list of frequently asked questions.
Financial Professional Gateway (FinPro)
FINRA’s Financial Professional Gateway (FinPro) provides individuals (current or former representatives) direct access to resources and tools to manage their securities registration information and a platform to monitor their continuing education requirements. FinPro is an important tool for IARs because it provides them with a mechanism to view courses taken and the progress towards completion of their annual CE requirement. Since IARs are responsible for ensuring their CE vendor reports completion of CE, they may find FinPro useful for tracking and monitoring CE.
Features of FinPro:
- Track and monitor CE
- View CRD record
- Schedule an exam
- Review/download last Form U5
Sign up for a FinPro account on FINRA’s website at:
https://www.finra.org/registration-exams-ce/finpro
Access the FinPro Account Creation Guide at:
https://www.finra.org/sites/default/files/2019-09/FinPro_Guide.pdf.
Additional questions? See FinPro’s FAQ webpage: https://www.finra.org/registration-exams-ce/finpro/faq