One method of complying with the financial solvency requirements for RIAs in the state is the posting of a Colorado registered investment advisor bond. Per the state industry regulator, "Investment Advisory firms ("state IAs") located in Colorado with assets under the $25 million threshold, with a place of business in Colorado, or with six or more clients in Colorado must comply with the local registration requirements." The regulations cover both Investment Advisers (firms that employ investment adviser representatives) and Investment Adviser Representatives (individuals who offer investment advice including financial planning services).
Firms domiciled in Colorado with assets under the $100 million federal threshold and IA firms not located in Colorado with assets under $100 million who have more than five clients in Colorado are required to have a Colorado license. Each applicant for state licensing must comply with the solvency review requirements of the Division of Securities. Those IAs that are ordered to do so, must provide the Division with a Colorado investment advisor bond on form U-SB. The surety bond guarantees that the IA will comply with all applicable provisions of, and orders, rules and regulations issued pursuant to the applicable securities statutes of Colorado. Posting of the investment advisor bond does NOT abrogate the applicant's duty to comply with SEC registration or other federal and state requirements.
National surety bond leader, Surety One, Inc., specializes in underwriting surety and fidelity bonds for the financial services sector. For more information or application materials for a Colorado Investment Adviser surety bond call (800) 373-2804, email us at Underwriting@SuretyOne.com or click here to chat with an underwriter.
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