Mich. Admin. Code R. 451.4.29 - Investment adviser representative; continuing education

Rule 4.29.

(1) As used in this rule:

(a) "Approved IAR continuing education content" means the materials, which are in a written, oral, or other format, that have been approved by NASAA or its designee and that make up the educational program provided to an investment adviser representative under this rule.

(b) "Authorized provider" means a person that NASAA or its designee has authorized to provide continuing education content required by this rule.

(c) "Credit" means a unit that has been designated by NASAA or its designee as at least 50 minutes of educational instruction.

(d) "Home state" means the state in which the investment adviser representative has its principal office and place of business.

(e) "IAR ethics and professional responsibility content" means approved IAR continuing education content that addresses an investment adviser representative's ethical and regulatory obligations.

(f) "IAR products and practice content" means approved IAR continuing education content that addresses an investment adviser representative's continuing skills and knowledge regarding financial products, investment features, and practices in the investment advisory industry.

(g) "Investment adviser representative" or "IAR" means an individual who meets the definition of "investment adviser representative" under section 102a(f) the act, MCL 451.2102a, and an individual who meets the definition of "investment adviser representative" under SEC rule 203A-3, 17 CFR 275.203A-3.

(h) "NASAA" means the term as defined in R 451.1.1 or a committee designated by the association's board of directors.

(i) "Reporting period" means a 12-month period as determined by NASAA. An investment adviser representative's initial reporting period begins the first day of the first full reporting period after the individual is registered or required to be registered with this state.

(2) An investment adviser representative registered under section 404 of the act, MCL 451.2404, shall complete both of the following IAR continuing education requirements each reporting period:

(a) Six credits of IAR regulatory and ethics content offered by an authorized provider, with at least 3 hours covering the topic of ethics.

(b) Six credits of IAR products and practice content offered by an authorized provider.

(3) An investment adviser representative who is also registered as an agent of a FINRA member broker-dealer and who complies with FINRA's continuing education requirements complies with the subrule (2)(b) of this rule for each applicable reporting period, if the FINRA continuing education content meets all of the following baseline criteria as determined by NASAA:

(a) The continuing education content focuses on compliance, regulatory, ethical, and sales practices standards.

(b) The continuing education content is derived from state and federal investment advisory statutes, rules, and regulations; securities industry rules and regulations; and accepted standards and practices in the financial services industry.

(c) The continuing education content requires that its participants demonstrate proficiency in the subject matter of the educational materials.

(4) Credits of continuing education completed by an investment adviser representative who was awarded and currently holds a credential that qualifies for an examination waiver under R 451.4.12(3) complies with subrule (2)(a) and (b) of this rule if all of the following continue to occur:

(a) The investment adviser representative completes the credits of continuing education as a condition of maintaining the credential for the relevant reporting period.

(b) The credits of continuing education completed during the relevant reporting period by the investment adviser representative are mandatory to maintain the credential.

(c) The continuing education content provided by the credentialing organization during the relevant reporting period is approved IAR continuing education content.

(5) An investment adviser representative shall ensure that the authorized provider reports the investment adviser representative's completion of the applicable IAR continuing education requirements.

(6) An investment adviser representative who completes more than the amount of continuing education credits required for the reporting period shall not carry forward the additional credits to a subsequent reporting period.

(7) An investment adviser representative who fails to comply with this rule by the end of a reporting period shall renew as "CE inactive" at the close of the calendar year until the investment adviser representative completes and reports all required IAR continuing education credits for all reporting periods as required by this rule. An investment adviser representative who is CE inactive at the close of the next year is not eligible for investment adviser representative registration or renewal of an investment adviser representative registration.

(8) The administrator may, at its discretion, waive any requirements of this rule.

(9) An investment adviser representative registered or required to be registered in this state and who is registered as an investment adviser representative in the individual's home state complies with this rule when both of the following continue to occur:

(a) If the investment adviser representative's home state has continuing education requirements that are at least as stringent as the NASAA model rule on investment adviser representative education adopted by NASAA on November 24, 2020. A copy of this model rule can be obtained from NASAA, 750 First Street, NE, Suite 1140, Washington, D.C. 20002, and is available for free online at http://www.nasaa.org, or from the Michigan Department of Licensing and Regulatory Affairs, Corporations, Securities, and Commercial Licensing Bureau, P.O. Box 30018, Lansing, Michigan 48909 for a cost as prescribed in R 451.6.2.

(b) If the investment adviser representative complies with the home state's investment adviser representative continuing education requirements.

(10) An investment adviser representative who was previously registered under the act but is no longer registered shall complete IAR continuing education for all reporting periods that occurred between the time that the investment adviser representative was no longer registered and when the person became registered again under the act unless the investment adviser representative takes and passes the examination or receives an examination waiver as required by R 451.4.12 in connection with the subsequent application for registration.

Notes

Mich. Admin. Code R. 451.4.29

2022 MR 4, Eff. 2/16/2022