New investment adviser representatives must agree to background checks, state regulation says

People seeking to be registered as investment adviser representatives with the Massachusetts Securities Division will soon be required to agree to be “checked through the Massachusetts Criminal Offender Record Information” system, or CORI, the office of Massachusetts Secretary of State William F. Galvin said Thursday.

The requirement, effective Jan. 3, applies to all investment adviser representatives applying for registration in Massachusetts, regardless of whether they are associated with state or federally registered investment advisers, Galvin’s office said.


It does not apply to those making annual renewal applications, the office added.

Under the 2010 Dodd-Frank overhaul Congress adopted after the financial crisis, 140 investment advisers switched registration from the US Securities and Exchange Commission to the state.

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The Massachusetts Securities Division, which Galvin oversees, is implementing the regulation to ensure that local investment advisers are subject to background checks similar to those required by the Financial Industry Regulatory Authority, or FINRA, for broker dealer agents. Galvin’s office said.

On its website, FINRA describes itself as “a not-for-profit organization authorized by Congress to protect America’s investors by making sure the securities industry operates fairly and honestly.”

Chris Reidy can be reached at
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