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Can a Felon Become a Financial Advisor?

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Job options may be limited for felons recently out of prison, but there are resources available. At some point, felons may want to consider a career in the finance industry. Felons with experience or interest in this area might want to become a financial advisor.

This blog post will cover the issue of whether or not a felon can become a financial advisor.

  • What is a Financial Advisor?
  • Requirements to Become a Financial Advisor
  • How Much Does a Financial Advisor Earn?
  • An Opportunity for Felons?
  • Fitness Standards
  • Recommended Action


What is a Financial Advisor?

A financial advisor or financial planner helps individuals make decisions regarding money management. He or she will assess someone’s financial position and make recommendations on how to achieve their financial goals. A financial planner typically does the following activities:

  • Meets with clients to discuss financial goals
  • Explains financial services
  • Educates clients about investment options
  • Recommends investments
  • Monitors clients’ accounts
  • Researches investment opportunities

A financial planner must have a number of skills in order to be successful:

  • Analytical skills
  • Interpersonal skills
  • Strong math skills
  • Sales skills

Requirements to Become a Financial Advisor

A financial adviser completes education and training for the certification necessary to become a professional financial advisor. The minimum educational requirement for financial advisor is a bachelor’s degree, usually in finance, accounting, business, economics, statistics, or a similar field.

Classes may include:

  • Risk management
  • Taxes
  • Investments and estate planning

To become a financial planner, a candidate must earn certification as a certified financial planner. Three years of experience and passing a certification exam are part of the requirements to become a certified financial planner.

Becoming a financial advisor requires passing the Series 7 exam and meeting educational requirements. The Series 7 exam covers financial topics relating to the trading of many different types of securities. This exam is also required of someone that wants to work as a stockbroker.

How Much Does a Financial Advisor Earn?

According to the U.S. Bureau of Labor Statistics, there were approximately 171,900 working financial advisors in 2016. The median wage for a financial advisor was $108,900 in 2014. The median wage is that income at which half of the financial planners earn less and have of them earn more than that amount.

Experience and skill level could have a significant impact on these earnings. Areas of the country where financial advisors get paid the most are the East and West coasts. A financial advisor in New York, Connecticut, Massachusetts, Maine, or Kansas tends to have a higher income than those in other areas.

Job growth for financial advisors is expected to be 11% from 2016 to 2026. The aging population and the need for qualified professionals to offer financial recommendations are the keys to this job’s growth.

An Opportunity for Felons?

Most financial advisors need several licenses from the Financial Industry Regulatory Authority (FINRA) to sell securities. A background check will be conducted for a candidate’s personal, professional, and financial life.

A disclosure for a criminal background is conducted through the Uniform Application for Securities Industry Registration or Transfer (U4).

Relevant questions concerning a felony include:

  • Did you plead guilty or no contest?
  • Were you convicted of a felony?
  • What was the nature of the crime?
  • How long ago was the crime committed?

An application may be denied if there have been any charges of crimes such as:

  • Investment activity
  • Financial crimes
  • Perjury
  • Forgery
  • Counterfeiting
  • Bribery
  • Fraud
  • Making false statements
  • Extortion

Professional conduct is another area of investigation with questions about professional termination, regulatory action, and client complaints in which a candidate was a respondent or a defendant.

This part of the background check focuses on negative actions related to investment activity:

  • Making false statements
  • Omissions
  • Violating finance laws
  • Violating regulations in prohibited sales practices

Personal and professional financial background information is also required in order to obtain a license to become a financial advisor. All involvement with creditors and bankruptcies involving the candidate and the companies for which he or she has worked will be investigated. All liens and judgments must also be revealed.

The FINRA allows explanation of the circumstances of anything that might prevent becoming licensed. Honesty is important, and a negative response may lead to denial of a license and subsequent legal charges.

Fitness Standards

The Certified Financial Planner Board has specific standards for character fitness to ensure an individual’s past conduct will not adversely affect professional certification.

Specific conduct that is judged to be unacceptable involves:

  • A felony conviction for theft, embezzlement, and other financial crimes
  • A felony conviction for tax fraud or tax-related crimes
  • Revoking of a financial planner license
  • Felony conviction of murder or rape
  • Felony conviction of any violent crime within the past five years

The following actions may be viewed as unacceptable depending on the outcome of a petition of the commission:

  • Two or more personal or business bankruptcies
  • Revoking or suspending of a non-financial professional license
  • Suspension of a financial professional license
  • Felony conviction for a nonviolent crime (including perjury) within the last five years
  • A felony conviction for a violent crime other than murder or rape that occurred more than five years ago

Other actions that will be considered for character fitness include:

  • Client complaints
  • Arbitration
  • Civil proceedings
  • Misdemeanor conviction(s)
  • Employer investigation and termination

The board will rule whether an individual’s conduct is within the unacceptable area which will lead to permanent barring from becoming certified. The individual may submit a written petition for the board to review the case.

The board may request relevant documentation for consideration. Following this, the petition will either be granted or denied.

In order to be successful in their pursuit of becoming a financial advisor, it’s essential for felons to be honest about their background. They are already working with the negative perceptions of being dishonest, untrustworthy, and unwilling or unable to follow directions from authority figures.

There are re-entry programs, such as drug treatment, and educational opportunities for felons who need them. For many felons, having their felony expunged can give them the chance they need to begin with a clean record and succeed in becoming a financial advisor.

Recommended Action

It’s a significant challenge, but it might be worth it for a felon that wants to become a financial advisor. Having his or her record expunged and also documenting any training programs or additional education could make the essential difference in a felon succeeding in becoming a financial advisor.

Having support from family, friends, or previous employers can make a huge difference. A felon doesn’t have to be defined by his or her crime. We are not defined by our mistakes but by how we recover from them. He or she can begin again and live an honest life no matter how difficult it might seem.

What do you think about this blog post? Have you or someone you know been in the situation of trying to become a financial advisor with a felony? What was that like for him or her, and how did he or she achieve success? Please tell us in the comments below.

2 thoughts on “Can a Felon Become a Financial Advisor?”

  1. Great article!

    I’m wondering, though, what would be the next steps to finding out if a felony conviction would be subject to adverse action by the commission and how to get around it (legally of course)?

  2. I love that this is posted. People make mistakes all the time and once the debt is paid, the opportunity should be restored.
    Thank you Ron


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