Once an investment adviser has submitted all required paperwork and met the general requirements, the appropriate regulator reviews the application. The regulator depends on how the adviser is registered:

• The Securities and Exchange Commission (SEC) reviews federal-covered advisers.
• The state administrator reviews state-registered advisers.

Here are the key items the regulator looks for:

• Form ADV disclosures
• Filing fees
• Consent to service of process
• Net worth requirements
• Surety bonds

If everything is complete and the requirements are met, the adviser’s registration becomes effective. The SEC has a 45-day review period, while the state administrator has a 30-day review period.

As with broker-dealers and agents, an adviser can’t suggest that registration means the regulators have approved or endorsed the adviser.