Verifying a financial broker license is one of the most important steps an investor can take before trusting someone with their money. Licensed brokers are required to meet education, testing, and regulatory standards designed to protect investors. Unfortunately, high-profile fraud cases have shown that unlicensed or improperly licensed brokers continue to target investors. This guide breaks down the process into seven clear steps that any investor can follow to confirm whether a broker is properly licensed and in good standing.
If you or someone you know has been negatively impacted by a broker, don’t hesitate to reach out to Meyer Wilson Werning today. Our attorneys are experienced in broker misconduct cases and will help to guide you through the process with a free consultation.
Step 1: Understand the Types of Broker Licenses
Before beginning the verification process, it helps to know the kinds of licenses that exist and what they mean.
- Series 7 License (General Securities Representative License) – Allows brokers to sell most types of securities, including stocks, bonds, and mutual funds.
- Series 6 License – More limited than Series 7, typically covering mutual funds, annuities, and variable contracts.
- Series 63, 65, and 66 Licenses – State-level exams that cover laws, ethics, and advisory responsibilities.
- Investment Adviser Licenses – Required for professionals who manage client portfolios or provide financial planning services. Note that investment advisers are different than brokers.
Each license type signals specific qualifications. If a broker lacks the right license for the services they’re offering, that’s a red flag.
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Step 2: Know the Key Regulatory Bodies
Several organizations oversee brokers and their licenses. Understanding their role helps you know where to look when verifying a license.
- Securities and Exchange Commission (SEC) – Oversees broker-dealer firms and ensures compliance with federal securities laws.
- Financial Industry Regulatory Authority (FINRA) – Administers exams like Series 7 and monitors brokerage firms.
- North American Securities Administrators Association (NASAA) – Works with state regulators, develops competency exams, and enforces state-level rules.
Together, these agencies help ensure licensed brokers meet professional and ethical standards.
Step 3: Check State-Specific Licensing Requirements
States layer their own rules on top of federal standards. For example, California commonly requires the SIE, Series 63, and Series 7 along with firm registration and a background check; Texas is described as requiring at least a finance-related bachelor’s degree plus Series 66 or Series 7 and ongoing education; Florida highlights passing the SIE, Series 7, and Series 63 and filing Form U-4 for registration. Confirm your broker meets the rules where they do business.
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Step 4: Use FINRA BrokerCheck
BrokerCheck is a free public database. Search by name, firm, or CRD number to review essentials that can affect your safety as an investor. If a broker discourages you from using BrokerCheck—or won’t share a CRD number—that’s a serious warning sign. Using BrokerCheck, you can find:
- Current licenses and registrations
- Employment history and firm affiliations
- Customer disputes, disciplinary actions, or arbitrations
- Disclosures like terminations or bankruptcies
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Step 5: Contact State Financial Departments
Your state’s securities office can validate what you see online and provide official records tied to the broker and their firm. This step adds an extra layer of assurance that the advisor and the brokerage are properly approved to operate where you live.
- Verify active/in-good-standing status
- Ask about restrictions, suspensions, or conditions
- Learn how to file a complaint (and what evidence helps)
Step 6: Use Online License Look-Up Tools
Many states offer free insurance and securities license look-up tools. These online databases can show whether a broker is:
- Currently licensed and in good standing
- Facing restrictions or conditions on their license
- Recently lapsed or inactive
These tools are easy to use and provide real-time information, making them an efficient way to double-check a broker’s status.
Step 7: Review Financial Services Department Guidelines
Regulators publish the playbook: required exams (SIE, Series 6/7/63/65/66), registration steps (including Forms U-4 and BD), and continuing-education rules. Knowing the baseline helps you spot gaps in a broker’s story and holds the financial advisor and their firm to the standards designed to protect you.
How Meyer Wilson Werning Helps Investors Harmed by Financial Advisors
Even if you carefully verify a broker’s license, misconduct and fraud can still occur inside brokerage firms. Firms are legally responsible for supervising their financial advisors and protecting investors. If you suffered losses because of a financial advisor or broker, Meyer Wilson Werning has the experience to hold them accountable through arbitration and other legal claims. We work exclusively for investors—not advisors or firms—and can guide you through your recovery options. Contact us today for a free consultation to discuss your case and learn how we can assist you in protecting your financial interests.
Frequently Asked Questions
What types of broker licenses exist, and why do they matter?
Broker licenses, such as the Series 7, Series 6, and state-level Series 63/65/66, determine what financial products an advisor is authorized to sell. Investment adviser licenses are also required for portfolio management or financial planning. If a broker lacks the correct license for the services they’re offering, that is a red flag for investors.
Who are the main regulators overseeing broker licensing?
Three key bodies regulate brokers: the SEC (federal oversight of broker-dealers), FINRA (administers exams and monitors firms), and NASAA (works with state regulators). Each ensures brokers meet professional and ethical standards, but investors should also check with their state securities office for local requirements.
How can I use FINRA BrokerCheck to verify a broker?
BrokerCheck is a free database where investors can search for a broker by name, firm, or CRD number. It reveals licenses, employment history, customer complaints, disciplinary actions, and disclosures. If a broker discourages you from checking their record, that’s a major warning sign.
Do licensing requirements differ by state?
Yes. Each state has its own additional requirements layered on top of federal standards. For example, California, Texas, and Florida each highlight specific exams, registrations, or continuing education obligations. Always confirm that a broker is licensed to operate in your state.
What should I do if I suspect a broker is unlicensed or misrepresenting credentials?
Start by gathering documentation, checking FINRA BrokerCheck, and contacting your state’s securities division for confirmation. If issues persist or you’ve already suffered financial harm, consulting with a securities fraud attorney can help you pursue recovery options.
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