The Financial Industry Regulatory Authority warned investors to carefully review the alphabet soup of professional designations, as some can be fake.
FINRA's professional designations tool lists a whopping 177 financial designations.
The self-regulator notes in a just-released investor alert that there's a difference between being registered or licensed and holding a professional designation.
Those providing financial advice and conducting sales activities in the securities and insurance industries must be registered with a regulatory body — as brokers must register with FINRA, a state securities regulator or both, while advisors must register with either the Securities and Exchange Commission or a state securities regulator.
However, professional designations, FINRA states, "are generally administered by an issuing organization that determines the criteria needed to earn the designation."
FINRA warns that while some financial designations involve "fairly rigorous standards" to earn and maintain the designation, allow investors to verify the status of anyone claiming to hold that designation and a few even have a formal disciplinary process, others are relatively easy to earn and might be maintained by simply paying a yearly fee.
