IB Friends & Family vs. RIA ??

Discussion in 'Retail Brokers' started by Stok, Dec 10, 2005.

  1. Stok

    Stok

    What are the qualifications for each?

    If one managed under $25MM and less than 15 clients, are they exempt from havng to be a RIA ?
     
  2. Stok

    Stok

    Thanks.

    Looking for the answers to these two questions:

    1. - When does one "have" to be registered (state and/or SEC)...what are the criteria's?

    2. - Can a friends & family account charge fees via IB legally ? Whether mgmt fee and/or performance fee.
     
  3. JackR

    JackR

    It depends on the state you are in if you are under the federal threshold. . Suggest you do a google search for your state.

    I do not believe IB has any checking mechanism. You screw up, you get fined by your state or the feds.

    Also, I am clueless about what happens if you have commodities in the accounts.

    JackR
     
  4. Here is a link that might help...
    http://www.sec.gov/divisions/investment/iard/iastuff.shtml
    I believe most if not all states require federal form ADV electronically filed through IARD. But, as the previous poster mentioned, each state is unique. For instance, in Georgia, the limit is 6 people, in spite of IB allowing 15. IB's web site requires you to do your own due diligence in these matters. Also, RIA's are typically required to maintain some minimum level of personal net worth for their RIA biz.
     
  5. Stok

    Stok

    Will do more research. Thanks!

    I do know if one manages over $25MM, the SEC wants them to register (required to register).

    Since the F&F acct is a fancy way to manage individual accts, if one was exepmt for registering with state/SEC, if they could charge mangt fees through IB or it has to be a seperate contract/billing.

    Maybe IB_Steve could help answer....TIA!
     
  6. Pekelo

    Pekelo

    Correct, every state is different. In my state it is 5 people and they have to be residents here. Also you can not advertise yourself as a financial advisor. Call your comptroller's (or whoever is in charge) office and ask....