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Nebraska investment advisors need to submit a surety bond as part of the licensing process. Read on to learn more about what’s required.
Investment advisors register with the Nebraska Department of Banking and Finance. They are defined as persons who advise others on the value of securities, or in the buying and selling of securities for compensation. In Nebraska, financial planners also fall under the investment advisor licensing umbrella. The definition does not include the following professionals, among others:
- Investment advisor representatives (solicit clients or provide advice on behalf of an investment advisor)
- Banks, savings institutions, or trust companies
- A lawyer, accountant, teacher, or engineer who performs these services as part of their profession
- Publishers of newspapers or other publications whose writing does not advise a specific client’s situation
Nebraska investment advisors are licensed according to the terms of Revised Statute 8-1103, submitting applications and supplemental information to the DBF electronically through the Investment Advisor Registration Depository (IARD). Here are some of the items required with submission:
- $200 application fee
- Form ADV Parts 1 and 2
- Executed Affidavit of Investment Advisor Activity in Nebraska
- Current audited financial statement or certified balance sheet
- Articles of incorporation, LLC agreement, or articles of partnership
- If business is a corporation, Corporate Resolution form
- Net Capital Computation if firm is Nebraska-based
- $25,000 surety bond
- Specimen contracts/agreements
- Promotional and/or disclosure literature
- Web address if applicable
The surety bond required of investment advisors is to protect the funds of their clientele in the event that the advisor violates the law at a cost to the client. Among other violations, Nebraska investment advisors promise not to intentionally mislead their clients or commit fraud. If any claims are paid out from the advisor’s $25,000 surety bond, the advisor must reimburse the surety for that amount.
Nebraska investment advisors’ registration is valid for one year and expires annually on December 31 unless renewed. At renewal, advisors must have a current surety bond. In lieu of the bond, investment advisors can maintain a net capital of $25,000.
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