Registered Representative (RR)

What Is a Registered Representative (RR)?

A registered representative (RR) is a licensed professional who works for a broker-dealer and is authorized to buy and sell securities for clients, recommend investments, and open customer accounts. In the United States, the term is closely tied to the rules of FINRA, the self-regulatory organization that oversees brokerage firms and their employees. Firms use many job titles for this role, such as stockbroker, financial advisor, or account executive, so the registration itself is the more reliable indicator of what a person is licensed to do.

How Registration Works

Before handling customer business, a representative must pass qualifying examinations, such as the Series 7 exam for general securities, and be registered with FINRA and with the states where they do business. Registration details are recorded in a Form U4 filing, which lists the individual's employment and disciplinary history. This information is publicly searchable through FINRA's BrokerCheck tool, which allows investors to see whether a representative is registered and whether any complaints or regulatory actions are on record. Registration is a baseline requirement, not a guarantee of quality.

Duties and Compensation

Representatives are often paid through commissions on trades they execute, through a salary, or through a mix of both. They may sell products such as mutual funds, bonds, and stocks. Because pay structures can create conflicts of interest, regulators set standards for recommendations. Before the SEC's Regulation Best Interest took effect, the suitability standard governed most broker recommendations. Under Regulation Best Interest, broker-dealers must act in a retail customer's best interest when making a recommendation. This is a different standard from the full fiduciary duty owed by investment advisers, which requires acting as a trusted agent for the client at all times.

Why It Matters to Investors

An investor working with a registered representative should understand how that person is paid, which standard applies to their recommendations, and whether they are also registered as an investment adviser, since one individual can hold both roles. Questions about fees, conflicts of interest, and the specific services being provided help clarify the relationship. Registration rules differ in other countries, where similar licensing regimes apply under different regulators.