Industry Reps Choosing Dual Registration: FINRA — Evening Brief – 07.29.24

Registered representatives in the securities business are increasingly seeking dual registration, according to a report from the Financial Industry Regulatory Authority (FINRA).

The number of dually registered individuals increased to 319,597 in 2023, up from 295,670 in 2019, according to FINRA data, which was updated last week with the release of the 2024 Industry Snapshot report. In contrast, the number of people registered just as broker-dealer representatives fell to 308,975 last year, down from 328,939 in 2019.

Dual registrants surpassed broker-dealer reps in 2021, with 307,587 and 304,836, respectively, according to FINRA. The number of individuals registered solely as investment advisor representatives has also increased, rising to 85,184 in 2023 from 65,515 in 2019.

Advisor registration patterns are partly due to advisors switching from one kind of registration to another, with those who are only registered with broker-dealers being the most likely to change registration. From the end of 2022 to the end of last year, 265,820 people who were only registered with broker-dealers remained so, although slightly more than 14% switched or lost registration. There were 11,162 individuals who switched to dual registration, 421 to investment advisor registration only, and 31,829 were no longer registered.

Meanwhile, just 5.9% of dual registrants altered their registration status in 2023. The data revealed that 293,918 individuals remained dually registered, while 2,436 went to broker-dealer only registration, 3,382 to investment advisor only registration, and 12,581 were no longer registered.

Last year, approximately 8.4% of individuals who were only registered as investment advisors altered their registration status. Furthermore, 74,144 stayed primarily in that registration type last year, while 118 switched to broker-dealer registration, 1,065 to dual registration, and 5,645 were no longer registered.

Meanwhile, the number of people joining FINRA has outpaced the number of people leaving the regulatory agency over the last two years. The number of individuals entering was 46,683 in 2022 and 44,865 in 2023, whereas the number of those leaving was 38,233 and 37,346, respectively. The number of people departing FINRA had outnumbered those joining in each of the previous six years.