Common Exceptions That Allow an RIA Firm to Register with the SEC Rather than the State

While there are some exceptions, in general, investment advisors with $100 million or greater in regulatory assets under management ("AUM") must register with the SEC as Registered Investment Adviser ("RIA"). Some of the common exceptions which allow an investment advisor with less than $100 million in AUM to register with the SEC instead of the relevant state(s) include:

  • An investment advisor with its principal office and place of business in New York will generally register with the SEC if it has $25 million or greater AUM
  • Advisors to investment companies registered under the Investment Company Act of 1940 must register with the SEC regardless of AUM
  • Advisors that would be required to be registered in 15 or more states will generally register with the SEC regardless of AUM
  • Internet-only advisors may register with the SEC regardless of AUM

It should also be noted that new registered investment advisors that believe they will meet the eligibility requirements to be registered with the SEC within the first 120 days from the initial registration approval date, may also file the initial RIA registration with the SEC.