Before hiring anyone to touch your money, one free tool answers the essential questions: FINRA BrokerCheck, the public database operated under the Financial Industry Regulatory Authority, shows a professional's registration status, employment history, qualifying exams, and every disclosure event — complaints, regulatory actions, terminations — reported for the past decade. The same lookup also works for investment advisers through the SEC's Investment Adviser Public Disclosure system, and both run off filings the law requires. NewsJay publishes information and education, not investment advice.
What exactly does a BrokerCheck report contain?
Three layers. Registration: which firms and roles the person currently holds and held, with dates — an unregistered seller of securities is a categorical stop. Qualifications: the licensing exams passed and the registrations held, which map to what the person is legally permitted to sell. Disclosures: customer disputes, regulatory sanctions, criminal matters, and financial events like bankruptcies, each with the firm's side of the record attached. A disclosure is not automatically disqualifying — firms note that many are settled without admission — but a pattern, and above all a pattern the professional did not mention, is the finding that matters.
How do you run the check?
The lookup takes minutes and costs nothing.
- Collect the professional's exact name and current firm, plus their CRD number if offered
- Search the name at brokercheck.finra.org and match the person by firm and location
- Read the current registrations and confirm they cover the products being proposed
- Read every disclosure; open the reporting documents attached to each event
- Cross-check any adviser designation through the SEC's adviser database and the credential's own verification site
What separates a red flag from noise?
Volume and honesty separate them. A single decade-old dispute, disclosed and settled, on an otherwise long clean record is the record of a working professional. Multiple customer disputes alleging the same conduct, regulatory sanctions by a regulator, or a dismissal for cause are different in kind. The most predictive single finding is asymmetry: what the report says that the professional did not volunteer. Someone who explains their history unprompted is behaving like a fiduciary; someone whose history surprises you is not.
| Report element | Green light | Warrants questions |
|---|---|---|
| Registrations | Active, matching the products proposed | Lapsed in the state where you live |
| Disclosures | None, or isolated, aged, explained | Repeated disputes of the same type |
| Employment history | Stable, few short hops | Serial firm changes after events |
| Exams | Series 7 and 66, or equivalent, current | None matching the role |
Why the free check beats the referral
The consistent finding across enforcement cases is that victims were recruited through trust — family, congregation, community — and never ran the basic verification that would have surfaced prior sanctions. A referral tells you the person is likable; the database tells you what regulators know. Both facts are useful; only one of them is free of the friend's own incentives.
What questions should you ask before hiring anyone?
The interview is where verification turns into selection, and a handful of questions separate professionals worth fees from the rest. Are you a fiduciary, always, for all accounts — and will that be in writing? How are you paid, in dollars, for every product you would recommend to me? What is your discipline when markets fall — what did you advise clients in 2020 or 2022? Good professionals answer these comfortably and specifically; evasive or generic answers are themselves the finding. The BrokerCheck report verifies who you are talking to; the questions determine whether you keep talking.
What do the professional designations mean?
Alphabet-soup credentials differ materially. The CFP mark requires coursework, an exam, experience, and continuing education in planning; the CFA charter signals investment analysis depth; ChFC covers planning broadly. Others are marketing certificates earned in a weekend, and the honest test is verification: legitimate credentials publish verification directories and disciplinary processes for their holders, and a designation that cannot be verified independently is decoration. The sequence that protects investors runs credential, then record, then fit — with BrokerCheck covering the middle term and the interview covering the last.
How do fee structures change what gets recommended?
Compensation writes incentives whether or not anyone intends them. Commission-based brokers earn per transaction, which tilts advice toward activity; percentage-of-assets advisers earn more as accounts grow, which aligns with appreciation but not with keeping accounts simple; flat-fee and hourly arrangements fit advice that is episodic rather than permanent. None of the structures is corrupt and none is neutral — the working rule is simply knowing which structure you are paying and letting the disclosure documents, which regulation requires, confirm the answer. Investors who cannot state how their adviser is paid have found their first finding.
What is the one-sentence summary?
Five minutes in the public databases tells you what regulators know; the interview tells you what the databases cannot — and hiring anyone without both halves is a decision made with half the available evidence, which is precisely the gap the enforcement record feeds on.
Where do state regulators fit in?
State securities authorities license and discipline in parallel with FINRA and the SEC, run their own public databases, and handle complaints that begin locally — the third free verification layer. Their national association's website links every state's tool, and for advisers selling in a state without a federal registration, the state record is the primary one. The complete verification stack — BrokerCheck, the SEC database, the state regulator — takes fifteen minutes and costs nothing but the habit.
How often should you re-verify?
Annually for anyone managing your money, and immediately after a firm change — registrations move with the professional, disclosures arrive on no schedule, and the two-minute lookup is cheaper than the surprise it prevents.
FAQ
Is BrokerCheck the same as the SEC adviser database?
They overlap. BrokerCheck covers brokers and dual registrants; the SEC's Investment Adviser Public Disclosure database covers registered advisers and their firms, including Form ADV details on fees and conflicts. Running both is the complete check for anyone wearing two hats.
Does a clean report mean the person is good?
No — it means nothing adverse is on file. Competence and fit are separate questions, answered through interviews, fee transparency, and whether the person's obligations match your interests. The check is a floor, not a ceiling.
Can disclosures be removed?
Some events age off after set periods, and firms can dispute filings, but expungement requires a formal process with court or arbitrator approval. Absence of a disclosure therefore deserves a glance at the timeline, not automatic trust.
What if the person is not in the database at all?
Treat that as the loudest red flag available. Selling securities without registration is illegal, and unregistered sellers are the central casting of enforcement cases. Verify independently through your state regulator before any further contact.
For more context, read The SEC Rewrote Its Enforcement Manual in February 2026.
For more context, read how 401k matching works.
For more context, read How to Read Your Brokerage 1099 Forms Correctly.
