Finsie is a technology-driven financial advisor marketplace designed to help individual investors identify financial professionals based on factors such as location, services, credentials, fees, and other characteristics.
The company's model differed from that of a traditional investment advisor. Rather than primarily managing client portfolios, Finsie's platform used information about investors and financial professionals to facilitate advisor recommendations and connections.
Members can book virtual consultations with fee-only advisors to receive tailored financial advice on various topics, including retirement planning, tax optimization, and estate planning.
Objective
As Finsie prepared to launch and operate its marketplace, the company needed to determine how its technology-enabled advisory model fit within the federal securities regulatory framework. The business required SEC registration and a compliance program tailored to a platform that connected investors with financial professionals rather than primarily managing client portfolios.
Therefore, Finsie approached InnReg during its early stages with a vision to revolutionize the financial services industry by creating a technology-driven marketplace.
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Challenges
Finsie's business model raised regulatory questions that required more than a standard RIA registration process.
During registration, the SEC requested additional information regarding how Finsie's services met the definition of investment advice under the Investment Advisers Act and how the company's online model supported its eligibility for SEC registration.
The company also needed to translate RIA regulatory requirements into operational processes for a technology platform. This included establishing and maintaining controls around:
Financial advisor due diligence and ongoing reviews
Client and regulatory disclosures
Advertising and social-media communications
Books and records
Employee and contractor compliance
Registration maintenance and regulatory filings
Annual compliance reviews
As the business matured, these processes also had to be documented and maintained in a way that could support regulatory examination.
InnReg's Solution
InnReg played a crucial role in assisting Finsie with the SEC registration process, helping regulators understand Finsie's advisory activities, advisor-recommendation process, and registration eligibility.
Our team of consultants guided Finsie in designing its platform to meet regulatory requirements while maintaining its distinctive features.
InnReg then helped establish and maintain a broader compliance program that included:
Developing and updating the Compliance Manual and Code of Ethics
Preparing and maintaining Form CRS materials, website and client disclosures, privacy materials, Terms of Use, social-media disclosures, and related agreements
Establishing advisor due diligence and review processes covering licensing, IAPD and FINRA BrokerCheck information, credentials, Form ADV disclosures, fees, websites and social media, disciplinary history, complaints, and supervisory review
Supporting a documented advertising-review process for website content, advisor profiles, Instagram posts, Twitter content, and other communications
Building and maintaining vendor-management processes covering contracts, OFAC checks, privacy reviews, business-continuity considerations, service levels, data-breach searches, and annual reviews
Supporting information-security policies and cybersecurity review processes
Managing recurring compliance activities such as annual reviews, disclosure updates, advisor reviews, personnel-related compliance, and regulatory filings
The advisor-review framework became particularly significant because advisor selection was central to Finsie's service. By 2023, the company's annual review process documented regulatory and business information across dozens of advisors, including registrations, Form ADV materials, fees, websites, social-media accounts, disciplinary history, complaints, and supervisory sign-off.
InnReg also supported Finsie during a 2023 SEC examination. The examination addressed matters involving advisor due diligence, implementation of social-media policies, annual compliance-review procedures, books and records, and Form ADV disclosures.
Client Results
Finsie received SEC approval on March 17, 2021, and launched its technology-driven financial advisor marketplace.
Since then, the platform has grown beyond its initial offering. Today, Finsie says users can choose from more than 100 experienced, fee-only financial advisors, while the marketplace has expanded to include financial planners, investment advisors, accountants, attorneys, career coaches, and insurance professionals.
Finsie has also continued developing its technology, including the introduction of Ask Finsie, which allows users to start with a financial question and helps connect them with an appropriate professional.
Years after its SEC registration, Finsie continues to operate its financial-services marketplace competitively. InnReg's engagement supported the regulatory and compliance infrastructure behind the company from its initial SEC registration through multiple years of operation and continued product development.
