Check your broker’s background with free BrokerCheck tool

Before working with a broker or other financial professional, the first thing you should do is make sure that person is licensed to sell you an investment. You can do this by using BrokerCheck®, a free online tool from the Financial Industry Regulatory Authority (FINRA).

Make sure the investment professional is licensed either with FINRA as a registered representative, or with the Securities and Exchange Commission or a state securities regulator as a registered investment adviser. You can look up a specific firm or investment professional, or you can search by ZIP code to find professionals or firms in your area. 

When you look up an individual, you can find:

  • a 10-year employment history;
  • approved licenses, registrations and qualification exams passed;
  • criminal felony charges and convictions, and certain misdemeanor charges and convictions; and
  • disciplinary actions and sanctions imposed by FINRA, the SEC or other regulators.

When you search for a firm, you can find:

  • its address, legal status and types of business it engages in;
  • a 10-year history of all felony charges and convictions, and certain misdemeanor charges and convictions;
  • disciplinary actions and proceedings initiated by regulators; and
  • bankruptcy proceedings and arbitration award information.

If an individual or firm doesn’t have a history of reported problems, BrokerCheck can help you detect potential red flags. For example, you can see if an individual broker has switched firms frequently over a short period of time, or if the firm has changed its name often.

In addition to using BrokerCheck, it’s a good idea to check with your state securities regulator, local consumer groups, or others who have business relationships with a particular financial professional before deciding to work with him or her.

Blog Topic: 
Investing

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