As an advisor living in Wisconsin, starting an RIA will require you to follow specific state guidelines. In this article, we will explore what those are so you can prepare.
Advisors living in Wisconsin, serving Wisconsin residents, or marketing their services in Wisconsin must register with the state.
Before you take this on yourself, consider hiring a compliance consultant to help make this process easier.
Financial statement requirements for the state of Wisconsin:
Advisors must have one of the following professional designations to operate in Wisconsin: Series 65, Series 66 and Series 7, CFP, CFA, CIC, ChFC, or PFS.
Individual Advisor Representatives (IARs) must pay all the state’s registration filing fees and complete the following to register their RIAs successfully:
-
Submit FINRA Entitlement Paperwork
In order to file an application for an RIA, an advisor must first apply for an account on FINRA’s WebCRD/IARD online system. It should be noted that FINRA does not regulate or supervise RIAs, but the state uses its system to process applications. -
Form ADV Part 1 (online portion)
This is the online component of the ADV. In Form ADV Part 1, an advisor will disclose information about the RIA only (individual information is shared in ADV Part 2B). This part of the ADV is also used to upload ADV Part 2A and ADV Part 2B.
In Form ADV Part 1, an advisor will include information about ownership, clients, business practices, employees, affiliations, and any disciplinary events of the advisor or employees. -
Form ADV Part 2A (paper and online)
This is the RIA’s disclosure brochure. Wisconsin requires that this be written in plain English that clients easily understand. This brochure will contain information about the firm’s services, fees, disciplinary disclosures, and other information about the RIA.
The state also requires this to be given to all prospective and current clients.
-
Form ADV Part 2B (paper and online)
In this brochure, which in most cases is also given to clients, will contain information about the advisor. In this part, an advisor will disclose information about their employment history, educational background, potential conflicts of interest, and any disciplinary actions.
It should also be noted that any Executive Officers or representatives who advise clients must complete this form. -
Client Advisory Contract
This filing shows the state of Wisconsin that the RIA is following the regulatory authority standards for client advisory contracts. - Code of Ethics
Wisconsin has set specific standards that RIAs must follow, and this filing will show that the RIA is upholding the fiduciary standards set forth by the state. -
Privacy Policy Statement
The state requires that The Privacy Policy Statement be given to the clients at the start of the relationship and annually after that. This statement must include information about how the RIA handles, stores, and share client information.
While each Privacy Policy Statement will vary by RIA, it must meet the state’s compliance requirements. -
Policies and Procedures Manual
Every RIA must have a Policies and Procedures Manual that details how the RIA maintains and enforces its internal policies. It should have detailed instructions about how the RIA handles client complaints all the way to how it trains new IARs.
It must also have information on Anti-Insider Trading plans, Business Continuity, Anti-Money Laundering, and Information Security.
Starting an RIA doesn’t have to be overwhelming with the right resources, such as our comprehensive RIA launch kit.
At Altruist, we strive to make independent financial advice better, more accessible, and more affordable. Our platform gives back precious time and capital to RIAs, so you can focus on what matters most: your clients and business.
On one intuitive, integrated platform, advisors can open and fund accounts, trade and rebalance, report, and bill, at a fraction of today’s edging-ever-higher technology costs.
Our dedicated customer support team is here to help advisors that are planning to make the leap from their wirehouse. Our team will help ensure a smooth transition with exceptional ongoing service.
To see how we’re helping RIAs streamline operations, reduce overhead, and elevate the client experience, book a call with one of our transitional specialists now.
*Altruist and its affiliates do not provide legal advice, so it’s important to check with a qualified professional for each state’s registration requirements.
