FINRA, or the Financial Industry Regulatory Authority, created BrokerCheck as a free, online research tool that provides information about individual brokers, investment advisors and the firms that employ them. The database contains details like registrations, employment history and any disclosures they may have. You can also use our financial advisor matching tool to find an advisor near you.
What Is FINRA BrokerCheck, and How Do You Use It?
FINRA is the organization that oversees the database that is BrokerCheck. This non-government agency issues regulations meant to keep professionals working in an ethical capacity. Every broker licensed to conduct securities transactions in the United States must register with FINRA.
Choosing a broker, investment advisor or financial advisor should be an arduous process. Not only are you trusting this person and company with the management of your money, you’re also picking someone who you ideally believe will help you create an adequate financial plan or investment portfolio.
Here to help is FINRA BrokerCheck, which aids you in determining if you can trust a particular person who you’re considering to help manage your assets. Through this extensive database, you can make sure that the broker or investment advisor you’re working with is licensed. Furthermore, you can also review their qualifications and check if they have any disclosures on their record. These disclosures are incredibly important to check, as they might provide some insight into whether this person has broken legal or regulatory rules in the past.
To find the individual or firm you’re looking for, enter their central registration depository (CRD) number. You can get this number from the broker or advisor themselves, or you can simply search by their name and firm.
Most information on FINRA BrokerCheck comes from two sources: the Central Registration Depository (CRD) and the Investment Adviser Registration Depository (IARD). CRD provides information about registered and licensed brokers, while IARD uses information from the U.S. Securities and Exchange Commission (SEC) for information about investment advisors.
What You Can Find About Brokers on BrokerCheck
FINRA BrokerCheck offers a wealth of actionable information on brokers, investment advisors and firms that are currently registered with FINRA or who have been within the previous 10 years. You can find the following information on brokers through BrokerCheck:
- Report Summary
- This involves a brief overview of the broker’s current job functions and credentials.
- Qualifications and Licenses
- Here, you can access the broker’s various registrations and licenses. It also contains a list of any qualification exams he or she has passed to gain wider access to the securities industry. In order to be licensed to trade most securities, a broker must pass the Series 7 exam.
- Registration and Employment History
- This section breaks down the broker’s employment history over the last 10 years. These may include jobs outside the securities industry, but they generally don’t. It also provides a listing of registered securities firms where the broker is or has been registered with.
- This segment contains information about whether the broker underwent disciplinary action, customer disputes or criminal offenses. If present, some of these disclosures may involve matters that are pending action or have yet to be resolved. It also contains the broker’s most recently submitted comments on these matters, if there are any.
Brokerage Firm Information on FINRA BrokerCheck
While you’ll surely want to learn about the advisor or broker you might work with, the firm itself matters just as much. In turn, learning about the firm may give you some insight into the kinds of overarching practices the firm engages in. Much of the firm information found on BrokerCheck may overlap with what’s available for a broker, but things are typically more general. Check out what you’ll find below:
- Report Summary
- Through this section, you can take a look over the firm’s services and history. It also shows where the firm is licensed to operate and its addresses. Here, you can also access the link to the firm’s SEC profile if it is an investment advisor in addition to a brokerage.
- Firm Profile
- This segment contains a detailed breakdown of the firm’s structure. It includes the firm’s founding date, as well as the names and titles of its largest shareholders and leaders.
- Firm History
- This section tracks the firm’s moves from establishment to the present. It details any mergers, acquisitions, name changes and similar actions.
- Firm Operations
- This part depicts the services the firm offers, along with any licenses and registrations it holds.
Information Available on Investment Advisors and Firm
The FINRA BrokerCheck database doesn’t contain detailed information about investment advisors and firms, but it directs you to the Investment Advisor Public Disclosure (IAPD) database that belongs to the SEC. You can look up a firm or individual by name or CRD number.
For most advisors and firms, you’ll find a Form ADV and one or more informational brochures. Every advisor registered with the SEC must file and update the Form ADV at least annually. This document provides a glance at information like business practices, types of clients served, disciplinary disclosures and much more. Brochures provide more intricate details, such as:
- Advisory Business
- This part explains the types of services the advisor or firm provides to its clients. It also goes over who owns the firm and how long it has been in business.
- Fees and Compensation
- This section provides a detailed breakdown of the fees the firm or the individual charges for each kind of service rendered. Keep an eye out here for any conflicts of interest that may be involved with said fees.
- Other Financial Industry Activities and Affiliations
- This provides crucial, but often overlooked, research material for a potential client. It details whether its business practices with other firms may affect the fees it would charge you, and whether these collaborations may pose a potential conflict of interest. For example, a firm or individual working for the firm may receive commissions from other firms for recommending its products.
Other Resources for Researching Brokerages
Depending on what other information you’re looking for, there are a few other databases that you can use during your research process. The first is the FINRA Disciplinary Actions Online database. This information hub offers further insights into the legal issues and disclosures that a broker, brokerage or advisor may have been involved in. However, this database only records disciplinary actions from 2005 and on.
FINRA’s Arbitration Awards database is another option that can provide some insights into the legal background of a firm or individual you’re considering working with. To locate case reports through this database, you’ll need to know a relevant case number, keyword or name and the the type of case it is.
FINRA BrokerCheck can be an effective research tool if you’re vetting brokers, investment advisors or firms to work with. It provides actionable information like a professional’s qualifications, fee structure and disciplinary disclosures if any. The database serves as a one-stop-shop for these details and more. Of course, you can also access additional resources like the databases and websites of your own state securities regulators.
Tips for Finding a Financial Advisor to Work With
- Making the right investment decisions with your hard-earned money can be difficult. Luckily, finding the right financial advisor to help you out doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in your area in 5 minutes. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.
- FINRA BrokerCheck can serve as a great starting point when vetting brokers or advisors. To help, we’ve produced one of the best overviews of the various online brokerage accounts available to you. So if you want to start investing on your own, be sure to pick the account that’s best suited to your needs.
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