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← Series 63: Regulation of Investment Advisers
Series 63 practice questionhardInvestment Adviser Representatives — Registration and Exemptions

XYZ Advisors, a federal covered investment adviser, has two IARs. The first regularly conducts advisory business from a home office in State A and serves only institutional clients there. The second has no place of business in State A and remotely serves five individual clients there. Which IAR must register in State A?

  1. ABoth IARs
  2. BOnly the IAR with the home office in State A✓ Correct answer
  3. COnly the IAR with five individual clients in State A
  4. DNeither IAR
Explanation

Why B — Only the IAR with the home office in State A

An IAR of a federal covered adviser may be required to register where the IAR has a place of business. The first IAR's home office is a place of business, so the institutional nature of the clients does not eliminate the registration obligation. The second IAR has no place of business in State A.

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