As the end of the year approaches, investment adviser representatives (“IARs”)[1] licensed in Colorado should be aware of the continuing education requirements necessary to maintain their IAR registration ahead of the compliance deadline set for December 31, 2025.
Background
On March 30, 2023, the Colorado Division of Securities adopted continuing education requirements (“CE Requirements”) for IARs. Under the CE Requirements, all licensed IARs of either Colorado-licensed investment advisers or federally covered investment advisers must complete 12 credits of continuing education (each a “CE Credit”) per calendar year, even if the IAR’s home state has not adopted similar rules.
An IAR with a home state other than Colorado will be considered in compliance with Colorado’s continuing education requirements so long as:
- The IAR’s home state has adopted continuing education requirements that are at least as stringent as Colorado’s IAR CE Requirements, and
- The IAR is in compliance with his or her home state requirements.
Although the CE Requirements were intended to go into effect for the 2024 calendar year, the Division adjusted the initial compliance date to allow for IARs to achieve compliance for the 2024 and 2025 calendar years (by completing a total of 24 CE Credits) by December 31, 2025.
Any IAR that fails to timely complete these CE Requirements runs the risk of being ineligible to renew his or her IAR registration for the 2026 calendar year.
Continuing Education Credits
Of the 12 required CE Credits, six must be related to industry products and practice (“Products and Practice Requirement”) and six must be related to ethics and professional responsibility (“Ethics Requirement”). An IAR who is registered as an agent of a Financial Industry Regulatory Authority (“FINRA”) member broker-dealer, and who complies with FINRA’s continuing education requirements, will be considered to be in compliance with the IAR CE Products and Practice Requirement if the FINRA CE Content meets certain baseline criteria determined by North American Securities Administrators Association (“NASAA”). Otherwise, for courses to count toward the required 12 CE Credit requirement, the content must be approved by NASAA and be administered by an Authorized Provider.
IARs will be able to monitor their IAR CE through FINRA’s FinPro System, and can find out more by using this guide. A list of Authorized Providers may be found here.
For additional guidance or support, please reach out to a member of our Asset Management Group or another member of the Davis Graham Team.
[1] Under C.R.S. § 11-51-201(9.6), investment adviser representatives are defined as “individuals who have a place of business in this state; who is a partner, officer, or director of an investment adviser; who occupies a status similar to or performs functions similar to those of a partner, officer, or director for an investment adviser; or who is employed or otherwise associated with an investment adviser who: (I) Makes recommendations or otherwise renders advice to clients regarding securities; (II) Manages securities accounts or portfolios for clients; (III) Determines which recommendation or advice regarding securities should be given to clients; or (IV) Supervises employees of, or persons otherwise associated with, an investment adviser or a federal covered adviser who perform any of the duties specified in this paragraph (a).”