Ask and Check (2024)

Many financial scams involve unlicensed individuals selling unregistered investments—ranging from stocks, bonds, and oil or gas deals to fictitious instruments, such as prime bank investments. That's why it is particularly important to "Ask and Check" about investments and investment professionals before you invest. Regardless of your trust or ties, or prior dealings with the professional, do your homework.

Check Out the Seller

If a salesperson is trying to sell you an investment, check them out by following these steps.

Step 1: Ask "Are you licensed to sell me this investment?"

Legitimate investment professionals—including registered financial professionals (also known as registered representatives), investment advisers and insurance agents—must be licensed with FINRA, the Securities and Exchange Commission (SEC) or your state securities or insurance regulator before they can sell you anything. If they say they aren't licensed, say good bye—and don't buy.

Step 2: Check.

If they say they are licensed, check them out as follows:

If They Say They Are a ...Look HereHelpful Hints
Registered Financial Professional
  • If you find the individual on BrokerCheck, click the "More Details" button below their name to view their summary report.
    Ask and Check (1)
    The summary report provides information on the individual's employment history, qualifications, disclosure events and more. You can also download a detailed report on the individual.
  • To interpret what you find, see FINRA BrokerCheck Tips below.
  • Use both FINRA BrokerCheck and contact your state. There's helpful information in both places.
Investment Adviser
  • If you find the individual on BrokerCheck, click the "More Details" button below their name to view their summary report.
    Ask and Check (2)
    The summary report provides information on the individual's employment history, qualifications, disclosure events and more. You can also download a detailed report on the individual.
  • To interpret what you find, see FINRA BrokerCheck Tips below.
  • If you find the firm on IAPD, click on its name to view its Form ADV (the investment adviser registration form).
  • For disciplinary information about the firm, scroll to the bottom of the page, and click "Item 11Disclosure."
  • If you find the individual on IAPD, click their name and click this button in the upper right side of the screen:
    Ask and Check (3)
    This will give you information on the individual’s employment history, qualifications, disclosure events and more.
Insurance Agent
  • Requirements and information available vary by state.
  • Be aware that "captive" agents can sell only the policies and products their company offers. Independent insurance agents typically represent multiple companies.

Find out more about BrokerCheck and get tips on searching for individual or firms.

Check Out the Investment: Is It Registered with the SEC?

Take these steps to check whether a recommended investment is registered with the Securities and Exchange Commission (SEC):

Step 1: Ask the person offering the investment, "Is this investment registered with the SEC?"

If the answer is no, ask why the investment is not registered. Not all securities offerings must be registered with the SEC—such as those issued by municipal, state and federal governments. The SEC also provides exemptions for certain intrastate offerings and small public and private offerings under a rule known as Regulation D. For more information, read the SEC's Microcap Stock: A Guide for Investors.

Step 2: If yes, then use the chart below to help you check that this is in fact the case.

Where to CheckWhat You GetHelpful Hints

SEC—EDGAR Company Search

Call the SEC's Office of Investor Education and Advocacy toll-free at (800) SEC-0330 if you have trouble using EDGAR or have questions about a company or investment.

  • Free public access to corporate information, including registration statements, prospectuses, annual reports with audited financial statements on Form 10-K and quarterly reports on Form 10-Q.
  • Information about recent corporate events reported on Form 8-K.
  • Confirmation of whether a company is using an exemption under Regulation D.
  • Read the SEC's tips for researching investments using EDGAR and other tools.
  • Be alert to changes in the company's name and trading symbol, reported through SEC Form 8-K.
  • Check if the company is filing current reports by looking for a 10-K report within the past year.

Your State Securities Regulator

  • Information about the investment beyond registration status, such as whether a promotion appears in violation of state securities law.
  • Ask if your state regulator is aware of any problems associated with the company or the type of investment.
  • You can also contact the North American Securities Administrators Association at (202) 737-0900.

Keep in mind that registration with the SEC does not guarantee that an investment will be a good one or immune to fraud. Likewise, lack of registration does not mean the investment lacks legitimacy. The critical difference is the extreme level of risk you assume when you invest in a company about which little or no information is publicly available. SEC registration carries a number of advantages for investors, including disclosure of financial and other information that can help investors assess whether to invest in a company's securities.

To check out the registration of the following types of investments, follow these steps:

Mutual FundsVisit the SEC's EDGAR Mutual Fund Search. If you find the mutual fund there, then it is registered with the SEC.

Variable Annuities

Variable Insurance Products

Visit the SEC's EDGAR Variable Insurance Product Search. If you find your variable annuity or other insurance product, then it is registered with the SEC.

Exchange-Traded Funds (ETFs)

Exchange-Traded Notes (ETNs)

Closed-end Funds

Visit FINRA Market Data. Click on the link that says Company Information in the far left column to search for your investment. If you find the ETF, ETN or closed-end fund on Market Data, it is registered with the SEC.
Ask and Check (2024)

FAQs

Do you ask enough questions or do you stay with what you know? ›

I always prefer to ask questions. In my opinion, being inquisitive should be a trait for everyone to have because how would we know anything if we don't ask questions. I have always valued the ability to ask questions and research things instead of settling for what I think I know or what I have heard from others.

How do you ask questions and get answers? ›

How to ask the right questions
  1. Develop an open-ended question. Create an open-ended question related to what you want to know. ...
  2. Allow the person to answer. It's important to choose the right time to ask questions. ...
  3. Ask follow-up questions. ...
  4. Thank the person. ...
  5. Ask to get an answer. ...
  6. Be understanding. ...
  7. Practice active listening.
Mar 10, 2023

How do you answer a question thoroughly? ›

Notice what happens.
  1. Listen to the Question. Sounds simple, but with so many things calling for our attention, it's easy to be distracted and not hear what the question really is. ...
  2. Pause. The second step is to pause long enough to take a breath from your diaphragm. ...
  3. Repeat the Question. ...
  4. Respond Honestly. ...
  5. Know When to Stop.

What to answer when asked how is everything? ›

How do you respond to how's everything? Fine, thanks, Excellent, Terrific, Great, Good, Not bad , So so, OK, Not great, Not so good, Terrible, Don't ask . The last one means, things are not good, so don't ask ... Phrase.

What is more important questions or answers? ›

“It is not the answer that enlightens, but the question.” ~ Eugene Ionesco. Questions are at the heart of every great conversation. They make us think, grow, and challenge our beliefs.

What is the paradox of asking questions? ›

Trying to figure out the Right Question to ask is a paradox. You cannot know if you've asked the right question until you have received an answer.

What is the ask and answer strategy? ›

The question-answer relationship (QAR) comprehension strategy teaches students how to ask key questions about their reading, and then how to find the answers to their questions — whether it means locating a specific fact, drawing an inference, or connecting the reading to their own experience.

What is a famous quote about asking questions? ›

A prudent question is one-half of wisdom. One who never asks either knows everything or nothing.

What are the hard questions in a relationship? ›

Tough questions for couples
  • What topic do you find the most difficult to discuss with your partner? ...
  • Does how you spend or save money cause any issues in your relationship?
  • How do you feel about how household chores are shared in your relationship?
  • Is there anything you'd like to change about your sex life?

How to answer questions smartly? ›

Prioritize clarity and relevance in your answers, avoiding unnecessary jargon or verbosity. The more you know, the better equipped you are to provide informed and intelligent answers.

What is the star method when interviewing? ›

The STAR method is a structured manner of responding to a behavioral-based interview question by discussing the specific situation, task, action, and result of the situation you are describing.

What is the best way to reply? ›

If you're responding to a message from another person, get them engaged within the conversation and give them a true response that is at least a sentence or 2 long. Sometimes, it's perfectly acceptable to respond with “o*k” if it makes sense in the context. But avoid the “K” reply, which can feel terse and rude.

How to tell someone you're not okay mentally? ›

You could say something like:
  1. “Thanks for asking. I've actually been having a tough time recently. Is it OK if I tell you about it?”
  2. “I don't have a simple answer to that question. Are you up for a conversation?”
  3. “Things have been hard. I'd really like to talk about it, if you're up for it.”
Feb 12, 2024

How are you holding up? ›

“How are you holding up?” is another way to ask, “How are you managing a difficult situation?” It acknowledges the other person is facing stress or hardship. When people ask this question, they usually expect a detailed response: describe your situation, ask for help (if needed), and be honest about your emotions.

How do you respond to everything is fine? ›

I'm very well. Everything is fine, thank you. I appreciate your message. I'm fine, thank you.

What is the rule of 20 questions? ›

The premise of the game is simple: One person, called the “answerer,” thinks of an object. The other player — the “questioner” — asks up to 20 yes-or-no questions in order to determine what object the answerer is thinking about. If the questioner guesses correctly within 20 questions, they win.

Do you know me well enough questions? ›

If you want to check how well your partner knows your interests, try the following questions:
  • What's my favorite food?
  • What's my favorite hobby?
  • What would my perfect getaway look like?
  • Do I prefer coffee or tea?
  • What's my favorite holiday?
  • What's my favorite TV show?
  • What food do I hate?
  • How many languages do I speak?
6 days ago

How important is it for us to keep asking questions? ›

It helps us identify gaps in our understanding and make sure we're on the right track when finding solutions. They also help us engage in meaningful conversations, build trust, and develop relationships. Asking questions might sound like just a simple thing, but it is still one of the most important skills in life.

Should you ask questions you know the answer to? ›

Asking a question when you already know the answer might seem counterintuitive or even annoying to some people, but it is actually a common behavior that can serve various purposes. One reason people ask questions they already know the answer to is to test the knowledge or honesty of the person they are asking.

References

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