Six more states have adopted the Investment Adviser Representative (IAR) Continuing Education (CE) Requirement effective in 2024. Any IAR doing business in Colorado, Florida, Hawaii, Nebraska, North Dakota, and/or Tennessee now has an annual IAR CE requirement. NASAA and WebCE are tracking all the current states looking to adopt and those who have already adopted.
Unique Circumstances for IAR CE in the State of California for the 2024 Compliance Period
The California Department of Financial Protection and Innovation (DFPI) has advised the Investment Adviser Representative Continuing Education Model Rule (the Rule) will be adopted and effective in 2024. While the Model Rule is still yet to be signed, they have confirmed they will accept credits for approved IAR CE courses completed at any time during the 2024 calendar year, even if completed before the adoption of The Rule.
FINRA has confirmed their system will accept reporting of IAR CE course completions for advisors doing business in California and, where applicable, the Regulatory Element CE. This information will populate to the IARs CRD account. The California IAR CE requirement is also in the IARs Financial Professional Gateway (FinPro) account.
IAR CE Inactive Status
If an individual fails to satisfy all the requirements of The Rule in a compliance period, they will pay the registration renewal fee, and CRD will set their status to “CE Inactive.” An IAR can continue to do business when in the CE Inactive status. All CE completed in the current year will be applied to the CE in arrears until that compliance period is satisfied.
If an IAR fails to satisfy all the requirements of The Rule in two consecutive compliance periods, the IAR will have a CRD status of “IAR CE Fail to Renew,” and they will be unable to do business. To become registered again, the IAR must make up the deficient CE and submit a new Form U4 for consideration.
It is important to note IARs registered for any portion of a year (even one day) to do business in an IAR state with an effective Model Rule adoption must complete the IAR CE requirements, even if their registration for the state has been withdrawn.
IAR CE Background
In November 2020, the North American Securities Administrators Association (NASAA) announced The Rule requiring IARs to complete CE annually. Each state must adopt the Rule individually to become effective for IARs doing business in that state. As a general rule, the effective date will be January 1 of the year following adoption.
The IAR CE requirement applies to all registered IARs. If an IAR does business in a state that has adopted the Rule, they must comply with it regardless of whether they are domiciled in that state.
CE Requirements Mandated by The Rule
The Rule requires IARs to complete 12 hours of CE annually. Six of those hours must be in Ethics and Professional Responsibility, three of those hours specific to ethics, and six must be in Products and Practices.
Course providers must ensure fifty percent (50%) of all course content approved for the Ethics and Professional Responsibility component focuses on ethics. For this reason, if an IAR satisfies the six-hour Ethics and Professional Responsibility component, they will have met the three hours of ethics required by The Rule.
An IAR dually registered with a Broker-Dealer may report their completed FINRA annual Regulatory Element CE to their IAR CE requirement to satisfy the entire six hours of The Rule’s Products and Practices component.
An IAR may not repeat any course (based on the Course ID number), nor can they carry forward any credits in excess of those required by The Rule.
All courses completed in the current year will be applied to any past year in which an IAR fell short of satisfying their CE requirements.
Providers, Courses, and Reporting
NASAA must approve all providers of IAR CE and their course through their vendor for program tracking, Prometric. Once courses are completed, the provider is required to report those completions to FINRA.
FINRA is the reporting entity for NASAA. An IAR can self-monitor their IAR CE credits by viewing their FinPro account. There is no requirement to report IAR CE credits to the state securities regulators.
IAR CE from WebCE
WebCE is a NASAA approved provider of IAR CE courses. Courses can be purchased individually or in pre-selected packages designed to satisfy your IAR CE requirements simply. With a large selection of IAR CE courses and next day reporting you can rest easy from fear of duplicating courses and having them reported on time.
Get even more with our multi-credit courses approved for IAR, Insurance and CFP CE. With these courses you can take less courses for more CE credits to satisfy all your CE requirements. For additional information, visit our website at www.webce.com/iar-ce.