Form CRS FAQs: When Brokers Must File and Deliver
Form CRS FAQs clarify who must prepare and deliver a relationship summary, including dual registrants, affiliates, and check-and-application mutual fund sales.
The clearest answer from the Form CRS FAQs is this: a SEC-registered broker-dealer with no retail investors to whom it must deliver a relationship summary is not required to prepare or file one. The guidance also confirms that delivery can be triggered even when a retail investor never opens a brokerage account, such as a mutual fund purchase made through a check-and-application arrangement.
These points matter for anyone checking US account and service conditions, because they turn on the firm's SEC registration status and its actual retail-facing activity, not on the label a firm uses about itself.
No retail investors means no filing obligation
The first scenario addresses a registered broker-dealer that has determined it has no retail investors to whom it must deliver a relationship summary. The FAQ answer is direct: if your firm does not have any retail investors to whom it must deliver a relationship summary, you are not required to prepare or file a relationship summary.
This is a conditional statement about the firm's facts, not a blanket exemption. The obligation follows the presence of retail investors owed a summary, so a firm that later gains such investors would be working from a different starting point. Users checking a firm's status should therefore read the answer as a reminder to look at actual delivery duties rather than at registration alone.
Dual registrant and affiliate scenarios
The guidance walks through two similar-sounding firms that reach different outcomes.
Firm A is a SEC-registered broker-dealer and a state-registered investment adviser. Firm B is a SEC-registered broker-dealer that also provides investment advisory services to retail investors through its affiliated state-registered investment adviser.
The question is whether either firm may prepare and file a single relationship summary under Form CRS Instruction 5, either as a dual registrant or as an affiliate. The answer is no in both cases, for distinct reasons.
- Firm A may not file a single summary as a dual registrant because a SEC-registered broker-dealer that is also a state-registered investment adviser does not meet the definition of a dual registrant in the Form CRS Instructions.
- Firm B's affiliated state-registered investment adviser may meet the definition of an affiliate, but that affiliate does not have a separate Form CRS filing and delivery obligation. Firm B therefore may not file a single summary together with it.
- Both firms must each prepare and file a relationship summary covering their brokerage services, and that summary must not exceed two pages.
- Affiliates should file a single relationship summary only where each affiliated entity has an SEC obligation to file.
The underlying logic is that the single filing route depends on every entity in the filing having its own SEC obligation. A state-registered adviser that has no separate federal filing duty cannot be folded into the broker-dealer's summary.
What firms may still do
Firms A and B are each permitted to acknowledge other financial services they provide in addition to their SEC broker-dealer services, including state-registered investment advisory services. That permission has a limit: the presentation must not obscure or impede understanding of the information that must be included in the relationship summary.
Firms may also include a means of facilitating access to additional information about those services, such as cross-references or hyperlinks. For a reader trying to understand why one document covers only part of a firm's business, this explains the result: the required summary stays focused on brokerage services, while other services may be noted without crowding out mandated content.
Check and application: no brokerage account required
The second major scenario concerns a broker-dealer that sells mutual funds to retail investors through a check-and-application arrangement, where it does not recommend the mutual fund and does not open a brokerage account for a new or prospective retail investor. The question is whether Form CRS filing and delivery still apply.
They do. The FAQ states that the Form CRS filing and delivery requirements under Rule 17a-14 apply even when a retail investor does not open or have an account with a broker-dealer but still engages in a securities transaction through a broker-dealer, such as the purchase of a mutual fund via a check-and-application process where the fund is not held directly within a brokerage account.
This is the most consequential point for users who assume that no account means no obligation. The trigger is the securities transaction through the broker-dealer, not the existence of an account.
When delivery is triggered
The FAQ then asks when delivery is triggered if the firm must file and deliver Form CRS. Under these circumstances, a broker-dealer must deliver the relationship summary before or at the time it places an order for the retail investor.
That timing is concrete and easy to check against an actual transaction sequence: delivery is tied to order placement, not to account opening or to a later confirmation step.
The two scenarios fit together. A firm with no covered retail investors has no summary to prepare or file; a firm that handles a covered transaction must deliver before or when it places the order, even if no brokerage account exists.
What the source does not say
The guidance does not state which particular firm's conduct is compliant, and it does not resolve how any individual transaction should be documented. It also does not address state-level investment adviser registration requirements, does not provide a general exemption for small firms, and does not describe penalties for late or missing delivery.
It does not say that a firm's public description of itself determines its filing status; the FAQ looks to definitions and obligations. Nor does it set out a complete list of retail-facing arrangements that trigger delivery beyond the examples discussed. The date the material was published or updated is not something to infer from these answers, and no statement here should be read as legal advice for a specific account or transaction.
Reading the answers together
For a user weighing whether a firm's paperwork lines up with its business, the durable checks are registration type, whether each entity has its own SEC filing obligation, whether a retail investor was owed a summary, and whether a securities transaction was placed through the broker-dealer.
Those four points explain both the dual registrant and affiliate outcomes and the check-and-application result. They are questions about facts and definitions, not about how a firm markets itself.
Sources
Informational only. Not financial, legal or investment advice. Check the primary sources listed above before you act on anything here.