Federal Securities Licensing 2026: SEC, FINRA Series 7/63/65/66, Uniform Securities Act, NSMIA

Federal Regulators

Securities and Exchange Commission (SEC): The SEC is the primary federal regulator responsible for administering and enforcing federal securities laws. For licensing purposes, the SEC registers broker-dealers (via Form BD) and certain investment advisers (via Form ADV), oversees their compliance with disclosure and conduct rules, and conducts examinations and enforcement actions to protect investors.

Financial Industry Regulatory Authority (FINRA): FINRA is a self-regulatory organization (SRO) under SEC oversight that directly regulates broker-dealers and their registered representatives. FINRA administers qualification exams (Series 7, 63, 79, etc.), maintains the Central Registration Depository (CRD) and BrokerCheck systems, enforces conduct rules, and performs routine examinations of member firms and associated persons.

Municipal Securities Rulemaking Board (MSRB): The MSRB writes rules for broker-dealers and banks engaged in municipal securities activities, including the Series 52 and 53 qualification exams for municipal securities representatives and principals. The MSRB does not directly enforce its rules; enforcement is carried out by FINRA (for broker-dealers) and federal banking regulators (for banks).

State Securities Regulators (NASAA Members): State securities administrators, coordinated through the North American Securities Administrators Association (NASAA), register and regulate investment advisers with less than $100 million in assets under management, register broker-dealer agents and investment adviser representatives, enforce state securities (blue sky) laws, and administer state-level examinations such as the Series 63 and 65. States retain broad antifraud authority even where federal law preempts registration.

Commodity Futures Trading Commission (CFTC): The CFTC regulates derivatives markets, including futures, swaps, and commodity pools. For licensing, the CFTC oversees registration of commodity trading advisers (CTAs) and commodity pool operators (CPOs) via the National Futures Association (NFA), a separate SRO; dual registrants as investment advisers and CTAs must comply with both SEC/state and CFTC/NFA requirements.

Key Federal Statutes & Rules

Securities Act of 1933 (15 U.S.C. §77a et seq.): Governs the registration of securities offerings and requires that investors receive material information through prospectuses and registration statements. While primarily focused on issuers, the Act's antifraud provisions under §77q affect broker-dealers and agents involved in securities distributions.

Securities Exchange Act of 1934 (15 U.S.C. §78a et seq.): Establishes the framework for ongoing market regulation and the registration of broker-dealers under §78o. Section 78o(b) requires broker-dealers to register with the SEC and become members of an SRO (typically FINRA). Section 15(b) also authorizes the SEC to sanction or bar individuals and firms for misconduct.

Investment Advisers Act of 1940 (15 U.S.C. §80b-1 et seq.): Requires investment advisers meeting certain thresholds to register with the SEC via Form ADV under §80b-3. The Act imposes fiduciary duties, prohibits certain conflicts of interest, and mandates compliance programs. SEC-registered advisers are subject to examination and enforcement under §80b-9.

Investment Company Act of 1940 (15 U.S.C. §80a-1 et seq.): Regulates mutual funds and other investment companies, requiring registration and compliance with governance, disclosure, and operational standards. Investment advisers to registered investment companies must themselves be registered and face heightened scrutiny.

Uniform Securities Act (State Model Law): Developed by NASAA as a template for state securities regulation, the Uniform Securities Act provides for state-level registration of broker-dealers, agents, investment advisers, and investment adviser representatives. Many states have adopted versions of the 1956 or 2002 Uniform Act, creating the "blue sky" regulatory framework.

National Securities Markets Improvement Act of 1996 (NSMIA, Pub. L. 104-290): Preempts state registration of "covered securities" (e.g., exchange-listed stocks, mutual funds) and federally registered investment advisers, while preserving state authority over smaller advisers and antifraud enforcement. NSMIA created the current split between federal and state investment adviser registration.

Dodd-Frank Wall Street Reform and Consumer Protection Act, Title IV (Pub. L. 111-203): Raised the assets under management (AUM) threshold for mandatory SEC registration from $25 million to $100 million, shifting mid-sized advisers to state registration. Section 410 also required certain "mid-sized advisers" to switch from SEC to state registration, effective in 2012.

FINRA Qualification Exams: FINRA administers qualification exams required for various securities activities. The Series 7 (General Securities Representative, codified in FINRA Rule 1210) qualifies individuals to sell most securities. The Series 63 (Uniform Securities Agent State Law Exam) tests knowledge of state securities regulations. The Series 65 (Uniform Investment Adviser Law Exam) qualifies investment adviser representatives. The Series 66 combines Series 63 and 65 content for dual registrants. The Series 79 (Investment Banking Representative) qualifies individuals for M&A and underwriting advisory roles.

Federal vs. State: Who Has Authority?

The division of authority between federal and state regulators in securities licensing reflects a layered system designed to balance investor protection with efficiency. Federal law, particularly the Securities Exchange Act of 1934, mandates that all broker-dealers register with the SEC and join FINRA, establishing a national regulatory floor. The Investment Advisers Act of 1940, as amended by NSMIA and Dodd-Frank, assigns registration authority based on assets under management: advisers with $100 million or more (or meeting other criteria, such as advising a registered investment company) register with the SEC, while smaller advisers register with states.

States retain significant authority despite federal preemption. Under NSMIA, states cannot require registration of SEC-registered advisers or covered securities, but they preserve the power to require notice filings, collect fees, and enforce antifraud provisions. State securities administrators register and regulate broker-dealer agents and investment adviser representatives—individual natural persons—even when the firm itself is federally registered. States also administer "blue sky" laws that can impose merit review of certain securities offerings, subject to NSMIA's limitations.

FINRA, as an SRO, operates under SEC delegation but exercises direct regulatory authority over its member broker-dealers. FINRA's rules (the FINRA Manual, including the 1000, 2000, 3000, and 4000 series) govern registration, qualifications, communications, supervision, and business conduct, effectively establishing the substantive standards that broker-dealers and their agents must meet. States participate in enforcement through coordination with FINRA and the SEC, often bringing parallel actions for conduct violating both federal and state law.

This cooperative federalism model means most securities professionals face multi-jurisdictional compliance obligations: a broker-dealer registers with the SEC and FINRA, its agents register through FINRA but are also subject to state notice and examination requirements, and dual-hatted investment adviser representatives may need both Series 7 and Series 65/66 licenses depending on their activities.

Pending Federal Legislation

Congress regularly considers legislation affecting securities licensing and regulation, though most proposals do not advance to enactment. Typical areas of legislative activity include adjusting the AUM thresholds that determine whether investment advisers register with the SEC or states, expanding or contracting the definition of "investment adviser" to capture new business models (such as robo-advisers or cryptocurrency advisers), and harmonizing the regulatory treatment of broker-dealers and investment advisers under a uniform fiduciary standard.

Other recurring legislative themes involve streamlining registration processes, reducing compliance costs for smaller firms, and addressing the implications of private fund advisers or exempt reporting advisers (ERAs) that operate outside full SEC registration. Congressional hearings frequently examine whether FINRA's SRO model should be extended to investment advisers or whether a new SRO should be created.

For the most current information on pending bills, rule proposals, and legislative hearings related to securities licensing, consult the live federal tracker embedded elsewhere on this site, which pulls real-time data from Congress.gov and agency rulemaking dockets. Because bill text, committee action, and floor votes change continuously, relying on a dynamic tracker ensures you have accurate, up-to-date information rather than stale snapshots that can mislead decision-making.

Frequently Asked Questions

Do I need both a federal and state license to operate as an investment adviser?

Investment advisers register either with the SEC or with one or more states, not both, based primarily on assets under management (AUM). If you have at least $100 million in AUM, you typically register with the SEC using Form ADV. If you have less than $100 million, you generally register with the state securities regulator(s) in the state(s) where you have a place of business or meet client thresholds. Certain advisers—such as those advising registered investment companies or business development companies—must register with the SEC regardless of AUM. Dual registration is generally prohibited under Section 203A of the Investment Advisers Act (15 U.S.C. §80b-3a), but switching between SEC and state registration can occur if your AUM crosses thresholds or you qualify for an exemption.

What exams do I need to pass to become a registered representative of a broker-dealer?

FINRA requires that broker-dealer agents pass a qualification exam appropriate to their activities. The Series 7 (General Securities Representative Exam) is the most common, covering equity, debt, options, and mutual funds, and is required for those who will solicit or sell most securities products. Many states also require the Series 63 (Uniform Securities Agent State Law Exam), which tests knowledge of state securities regulations and ethical practices. Specialized exams exist for specific functions: Series 6 for mutual funds and variable contracts, Series 79 for investment banking, and principal-level exams (Series 24, Series 51) for supervisory roles. You must be associated with a FINRA member firm to sit for these exams, and you must pass the Securities Industry Essentials (SIE) exam before taking most representative-level exams.

Can a broker-dealer agent also act as an investment adviser representative for the same clients?

Yes, but this "dual-hat" arrangement requires careful compliance with both FINRA and investment adviser rules. The individual must hold the appropriate licenses: typically a Series 7 and Series 63 for broker-dealer activities, and a Series 65 or Series 66 for investment adviser representative registration. The broker-dealer and investment adviser must have policies to distinguish brokerage (transactional) services from advisory (fee-based) services and disclose the different standards of conduct—suitability for brokerage, fiduciary duty for advisory. SEC Regulation Best Interest (Reg BI, 17 C.F.R. §240.15l-1) imposes a best-interest standard on broker-dealer recommendations, but it is not identical to the fiduciary duty owed by investment advisers under the Advisers Act. Dual registrants must navigate potential conflicts of interest and ensure clients understand which hat the professional is wearing in each interaction.

What is the difference between registering with FINRA and registering with the SEC?

FINRA registration applies to broker-dealers and their agents (registered representatives), while SEC registration applies to broker-dealers as firms (under Section 15 of the Exchange Act) and to investment advisers (under the Investment Advisers Act). In practice, a broker-dealer must register with both the SEC (via Form BD) and FINRA, because FINRA membership is mandatory for most broker-dealers. Individual agents of the broker-dealer register through FINRA's CRD system and appear on BrokerCheck, not directly with the SEC. Investment advisers with $100 million or more in AUM (or other qualifying criteria) register with the SEC using Form ADV but do not join FINRA unless they are also broker-dealers. Investment adviser representatives of SEC-registered advisers typically do not register with the SEC; instead, they may be subject to state notice filing or registration requirements for the states in which they conduct business.

Are there any exemptions from investment adviser registration?

Yes. The Investment Advisers Act provides several exemptions under Section 203(b) (15 U.S.C. §80b-3(b)). Advisers whose only clients are insurance companies are exempt under §203(b)(2)(A). Certain private fund advisers with less than $150 million in private fund assets in the U.S. may qualify as "exempt reporting advisers" (ERAs) under rules adopted pursuant to Dodd-Frank and file limited information on Form ADV but are not full registrants. Intrastate advisers—those with no place of business outside one state, fewer than five clients in the preceding twelve months, and who do not hold themselves out as investment advisers—are exempt under §203(b)(1), though states may still require registration. Advisers solely to venture capital funds may also file as ERAs under §203(l). De minimis exemptions and exclusions (e.g., lawyers, accountants, and publishers providing advice incidental to their profession) further narrow the registration requirement. Always consult current SEC rules and state law to determine whether an exemption applies to your specific situation.

State-by-State Guides

State-specific guides for all 50 states are in production. Check back soon, or subscribe to updates to be notified when your state ships.

Pending Federal Securities Licensing Legislation

Live data from Congress.gov. Updated daily. Pending = introduced and not yet enacted, vetoed, or signed into law.

S 2552 (119th Congress)

What it does: PRC Broker-Dealers and Investment Advisers Moratorium Act.

Latest status: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs. (2025-07-30)

HR 3348 (119th Congress)

What it does: Accredited Investor Definition Review Act.

Latest status: Placed on the Union Calendar, Calendar No. 103. (2025-06-04)

HR 3690 (119th Congress)

What it does: Securing Innovation in Financial Regulation Act.

Latest status: Referred to the Committee on Financial Services, and in addition to the Committee on Agriculture, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned. (2025-06-03)

S 1841 (119th Congress)

What it does: Fuel Choice and Deregulation Act of 2025.

Latest status: Read twice and referred to the Committee on Environment and Public Works. (2025-05-21)

HR 2689 (119th Congress)

What it does: To amend the Securities Exchange Act of 1934 to transfer authorities and duties of registered national securities associations to the Securities and Exchange Commission.

Latest status: Referred to the House Committee on Financial Services. (2025-04-07)

HJRES 82 (119th Congress)

What it does: Disapproving the action of the District of Columbia Council in approving the Insurance Regulation Amendment Act of 2024.

Latest status: Referred to the House Committee on Oversight and Government Reform. (2025-03-27)

S 712 (119th Congress)

What it does: Regulation Decimation Act.

Latest status: Read twice and referred to the Committee on Homeland Security and Governmental Affairs. (2025-02-25)

HJRES 56 (119th Congress)

What it does: Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Financial Crimes Enforcement Network relating to "Anti-Money Laundering/Countering the Financing of Terrorism Program and Suspicious Activity Report Filing Requirements for Registered Investment Advisers and Exempt Reporting Advisers".

Latest status: Referred to the House Committee on Financial Services. (2025-02-12)

Source: Congress.gov. Data refreshes daily — verify with the linked bill page before relying on it.