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Can an unregistered advisor advise their family members?



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Generally, anyone in the business of selling securities or offering investment advice in Canada must register with a securities regulator, regardless of whether or not the person they are advising is a family member. Registration helps protect investors because securities regulators will only register firms and individuals that meet specific qualifications and standards. Once registered, advisors must adhere to rules set out by securities regulators, including determining the types of investments that are right for you and providing advice that is suitable (or a good fit) to your investment goals and personal situation. If you plan to work with a financial advisor, visit to check if they are appropriately registered to sell investments or provide investment advice. You can also check if the individual or firm has been the subject of disciplinary action (e.g. for failing to comply with the rules and requirements of registration or for misconduct by the firm or individual against the investing public).
Generally, if your advisor is selling securities to the public in Ontario, the securities must be offered under a prospectus (a document that provides detailed information about the security and the company offering it), but there are some exceptions to this rule. For example, in Ontario, if a company is trying to raise money, they may be able to sell to a family member without a prospectus under the Family, Friends and Business Associates prospectus exemption. However, if the company or advisor is involved in selling and advising in those securities, they still need to be registered to do so.

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