Notice2026-20309
Potential Designation of Certified Financial Planner Certification as Qualifying Natural Persons for Accredited Investor Status
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
October 5, 2026
Issuing agencies
Securities and Exchange Commission
Abstract
Notice is given that the Securities and Exchange Commission (the "Commission") is considering whether to issue an order designating holding a certification as a Certified Financial Planner (a "CFP") in the United States in good standing as qualifying natural persons for accredited investor status.
Full Text
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<title>Federal Register, Volume 91 Issue 191 (Monday, October 5, 2026)</title>
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[Federal Register Volume 91, Number 191 (Monday, October 5, 2026)]
[Notices]
[Pages 63345-63352]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-20309]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 33-11448; File No. 4-934]
Potential Designation of Certified Financial Planner
Certification as Qualifying Natural Persons for Accredited Investor
Status
AGENCY: Securities and Exchange Commission.
ACTION: Notice; request for comment.
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SUMMARY: Notice is given that the Securities and Exchange Commission
(the ``Commission'') is considering whether to issue an order
designating holding a certification as a Certified Financial Planner (a
``CFP'') in the United States in good standing as qualifying natural
persons for accredited investor status.
DATES: This release was published in the Federal Register on October 5,
2026. Comments should be received on or before December 4, 2026.
ADDRESSES: Comments may be submitted by any of the following methods:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/comments/4-934/potential-designation-certified-financial-planner-certification-qualifying-natural-persons">https://www.sec.gov/comments/4-934/potential-designation-certified-financial-planner-certification-qualifying-natural-persons</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#e99b9c858cc48a8684848c879d9aa99a8c8ac78e869f"><span class="__cf_email__" data-cfemail="7e0c0b121b531d1113131b100a0d3e0d1b1d50191108">[email protected]</span></a>. Please include
File Number 4-934 on the subject line. To submit a comment to more than
one file, please include each file number on the subject line.
Paper Comments
<bullet> Send paper comments to Vanessa A. Countryman, Secretary,
Securities and Exchange Commission, 100 F Street NE, Washington, DC
20549-1090.
All submissions should refer to File Number 4-934. To submit a comment
to more than one file, please refer to each file number. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method of submission. The Commission will post all
submitted comments on its website (<a href="https://www.sec.gov/rules-regulations/public-comments/4-934">https://www.sec.gov/rules-regulations/public-comments/4-934</a>). Do not include personally
identifiable information in submissions; you should submit only
information that you wish to make available publicly. The Commission
may redact in part or withhold entirely from publication submitted
material that is obscene or subject to copyright protection.
FOR FURTHER INFORMATION CONTACT: John Byrne, Office Chief, Kenisha D.
Nicholson, Senior Special Counsel, or Max Corey, Special Counsel,
Office of Small Business Policy, Division of Corporation Finance, at
202-551-3460, Securities and Exchange Commission, 100 F Street NE,
Washington, DC 20549.
SUPPLEMENTARY INFORMATION:
I. Background
A. Accredited Investor Definition
Regulation D \1\ provides a widely-used set of exemptions from
registration under 15 U.S.C. 77a et seq. (the ``Securities Act'') for
the offer and sale of securities.\2\ Among other things, Regulation D
includes the regulatory definition of ``accredited investor'' in 17 CFR
230.501(a) (``Rule 501(a)'') followed by the three main operative
provisions--17 CFR 230.504 (``Rule 504''),\3\ 17 CFR 230.506(b) (``Rule
506(b)''),\4\ and 17 CFR 230.506(c) (``Rule 506(c)'').\5\ The
Commission has stated that the ``accredited investor'' definition under
Regulation D is intended to capture persons whose financial
sophistication renders the protection of the Securities Act's
registration process unnecessary.\6\
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\1\ 17 CFR 230.500 through 230.508.
\2\ Approximately $400 billion was raised in Regulation D
offerings (excluding pooled funds) between July 1, 2024 and June 30,
2025. See Staff Report from Office of the Advocate for Small
Business Capital Formation (``OASB'') Fiscal Year 2025 OASB Annual
Report (Jan. 8, 2026) at 14, available at <a href="https://www.sec.gov/files/2025-oasb-staff-report.pdf">https://www.sec.gov/files/2025-oasb-staff-report.pdf</a>.
\3\ Rule 504 provides an exemption from registration under the
Securities Act for the offer and sale of up to $10 million of
securities in a 12-month period from an unlimited number of
investors (without regard to whether those investors are
accredited).
\4\ Rule 506(b) is a safe harbor under section 4(a)(2) of the
Securities Act that permits issuers to raise any amount from an
unlimited number of accredited investors but limits the number of
non-accredited investors to 35 in any 90-calendar-day period. The
rule does not permit general solicitation and, where non-accredited
investors purchase in the Rule 506(b) offering, the information
requirements in 17 CFR 230.502(b) must be met. See 17 CFR
230.506(b)(1); 17 CFR 230.506(b)(2)(i); 17 CFR 230.502(b).
\5\ Rule 506(c) provides an exemption from registration under
the Securities Act, and permits issuers to raise any amount from an
unlimited number of accredited investors. The exemption permits
general solicitation, but issuers may not make any sales to non-
accredited investors under Rule 506(c), and the issuer must take
reasonable steps to verify that all purchasers are accredited. See
also Jumpstart Our Business Startups Act of 2012, Public Law 112-
106, sec. 201(a), 126 Stat. 306 (2012) (directing the Commission to
revise its rules ``to provide that the prohibition against general
solicitation or general advertising contained in section 230.502(c)
of such title [17] shall not apply to offers and sales of securities
made pursuant to section 230.506, provided that all purchasers of
the securities are accredited investors . . . . Section 230.506 of
title 17, Code of Federal Regulations, as revised pursuant to this
section, shall continue to be treated as a regulation issued under
section 4(2) of the Securities Act of 1933 (15 U.S.C. 77d(2))'').
\6\ See Accredited Investor Definition, Release No. 33-10824
(Aug. 26, 2020) [85 FR 64234, n.7 and accompanying text (Oct. 9,
2020)] (``Accredited Investor Adopting Release''); Regulation D
Revisions; Exemption for Certain Employee Benefit Plans, Release No.
33-6683 (Jan. 16, 1987) [52 FR 3015 (Jan. 30, 1987)]. See also SEC
v. Ralston Purina Co., 346 U.S. 119, 125 (1953) (taking the position
that the availability of the section 4(a)(2) exemption ``should turn
on whether the particular class of persons affected needs the
protection of the [Securities] Act. An offering to those who are
shown to be able to fend for themselves is a transaction `not
involving any public offering''').
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The definition of ``accredited investor'' is a cornerstone of
Regulation D and also plays an important role in other Federal
securities law contexts.\7\ Qualifying for accredited investor status
is significant because accredited investors may, under Commission
rules, participate in investment opportunities that are generally not
available to non-accredited investors, such as investments in private
companies and offerings by private funds.
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\7\ For example, each of 17 CFR 230.251 through 230.263
(``Regulation A'') and 17 CFR 227.100 through 227.504 (``Regulation
Crowdfunding'') contains limitations on the amount an investor may
invest if such investor is not an accredited investor. See 17 CFR
230.251(d)(2)(i)(C) and 17 CFR 227.100(a)(2).
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Accredited investors are natural persons and entities that come
within, or that the issuer reasonably believes come within, any of the
enumerated categories contained in Rule 501(a). Natural persons may
qualify as accredited investors if they are:
<bullet> Any director, executive officer, or general partner of the
issuer of the securities being offered or sold or of a general partner
of that issuer, pursuant to 17 CFR 230.501(a)(4);
<bullet> Individuals who have a net worth exceeding $1,000,000
(excluding the value of the individual's primary residence and any
indebtedness secured by such residence up to the estimated value of the
residence), either alone or with their spouse or spousal equivalent,
pursuant to 17 CFR 230.501(a)(5);
[[Page 63346]]
<bullet> Individuals who had an income in excess of $200,000 in
each of the two most recent years, or joint income with the
individual's spouse or spousal equivalent in excess of $300,000 in each
of those years, and have a reasonable expectation of reaching the same
income level in the current year, pursuant to 17 CFR 230.501(a)(6);
<bullet> Individuals who are holders in good standing of one or
more professional certifications or designations or credentials from an
accredited educational institution that the Commission has designated
as qualifying an individual for accredited investor status, pursuant to
17 CFR 230.501(a)(10) (``Rule 501(a)(10)'');
<bullet> Individuals who are ``knowledgeable employees,'' \8\ under
the Investment Company Act of 1940 (the ``Investment Company Act''),\9\
of the private-fund issuer of the securities being offered or sold,
pursuant to 17 CFR 230.501(a)(11); or
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\8\ 17 CFR 270.3c-5(a)(4).
\9\ 15 U.S.C. 80a-1 et seq.
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<bullet> Individuals who are ``family clients'' of a ``family
office'' \10\ under the Investment Advisers Act of 1940 (the ``Advisers
Act'') \11\ and whose prospective investment in the issuer is directed
by such family office in accordance with 17 CFR 230.501(a)(12)(iii),
pursuant to 17 CFR 230.501(a)(13) (``Rule 501(a)(13)'').
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\10\ 17 CFR 275.202(a)(11)(G)-1 (defining ``family office'').
\11\ 15 U.S.C. 80b-1 et seq.
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Various institutions may qualify as accredited investors based on
their status alone or on a combination of their status and the amount
of their total assets or investments. Institutions that qualify
include:
<bullet> Banks, savings and loan associations; brokers or dealers
registered pursuant to section 15 of the Securities Exchange Act of
1934; \12\ certain investment advisers; insurance companies; investment
companies registered under the Investment Company Act or business
development companies as defined in section 2(a)(48) of the Investment
Company Act; \13\ and certain specialized investment companies; \14\
plans established and maintained by a state, its political
subdivisions, or any agency or instrumentality of a state or its
political subdivisions, for the benefit of its employees, if such plan
has total assets in excess of $5 million; employee benefit plans
(within the meaning of the Employee Retirement Income Security Act of
1974 \15\) if a bank, savings and loan association, insurance company,
or registered investment adviser makes the investment decisions, or if
the plan has total assets in excess of $5 million, or, if a self-
directed plan, with investment decisions made solely by persons who are
accredited investors, pursuant to 17 CFR 230.501(a)(1) (``Rule
501(a)(1)'');
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\12\ 15 U.S.C. 78o.
\13\ 15 U.S.C. 80a-2(a)(48).
\14\ This includes small business investment companies licensed
under section 301(c) or (d) of the Small Business Investment Act of
1958 [15 U.S.C. 661 et seq.], and any rural business investment
company as defined in section 384A of the Consolidated Farm and
Rural Development Act [7 U.S.C. 1921].
\15\ 29 U.S.C. 1001 et seq.
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<bullet> Any private business development company as defined in
section 202(a)(22) of the Advisers Act,\16\ pursuant to 17 CFR
230.501(a)(2) (``Rule 501(a)(2)'');
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\16\ 15 U.S.C. 80b-2(a)(22).
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<bullet> Charitable organizations, corporations, business trusts,
partnerships, or limited liability companies not formed for the
specific purpose of acquiring the securities offered, with total assets
in excess of $5,000,000, pursuant to 17 CFR 230.501(a)(3) (``Rule
501(a)(3)''); \17\
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\17\ A charitable organization is as described in section
501(c)(3) of the Internal Revenue Code [26 U.S.C. 501(c)(3)].
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<bullet> Trusts with total assets in excess of $5,000,000, not
formed for the specific purpose of acquiring the securities offered,
whose purchase is directed by a sophisticated person as described in 17
CFR 230.506(b)(2)(ii), pursuant to 17 CFR 230.501(a)(7) (``Rule
501(a)(7)'');
<bullet> Entities in which all of the equity owners are accredited
investors, pursuant to 17 CFR 230.501(a)(8) (``Rule 501(a)(8)'');
<bullet> Any entity, of a type not listed in Rules 501(a)(1), (2),
(3), (7), or (8), not formed for the specific purpose of acquiring the
securities offered, owning investments in excess of $5,000,000,
pursuant to 17 CFR 230.501(a)(9);
<bullet> ``Family offices'' meeting certain requirements, pursuant
to 17 CFR 230.501(a)(12) (``Rule 501(a)(12)''); \18\ and
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\18\ The family office must have assets under management in
excess of $5,000,000; not been formed for the specific purpose of
acquiring the securities offered; and its prospective investments
directed by a person who has such knowledge and experience in
financial and business matters that such family office is capable of
evaluating the merits and risks of the prospective investment. See
17 CFR 230.501(a)(12)(i) through 230.501(a)(12)(iii).
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<bullet> Entities that are ``family clients'' of a ``family
office'' that meets the requirements of Rule 501(a)(12), pursuant to
Rule 501(a)(13).
B. Background on Rule 501(a)(10) and Overview of Potential Designation
Rule 501(a)(10) confers accredited investor status on any natural
person holding in good standing one or more professional certifications
or designations or credentials from an accredited educational
institution that the Commission has designated as qualifying an
individual for accredited investor status.\19\ In adopting Rule
501(a)(10), the Commission stated that certain ``professional
credentials and experience should enable [investors that hold such
credentials] to assess investment opportunities, appropriately allocate
capital based on their individual circumstances, including whether to
reallocate investment capital between private investments and other
equivalent-sized investments, and otherwise make appropriately informed
decisions regarding their financial interests, including their ability
to bear the financial risk.'' \20\
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\19\ Rule 501(a)(10) does not expressly define what constitutes
good standing. In connection with the adoption of Rule 501(a)(10),
the Commission stated that in addition to passing the relevant exam,
``maintaining an active certification, designation, or license is
sufficient to demonstrate the individual's financial sophistication
to invest in exempt offerings . . . . [and] that an inactive
certification, designation, or license, particularly when the
certification or designation has been inactive for an extended
period of time, could lessen the validity of the certification or
designation as a measure of financial sophistication.'' Accredited
Investor Adopting Release at 64242. See infra section II.B.1.
\20\ Id. at 64241.
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Rule 501(a)(10) contains the following non-exclusive list of
attributes that the Commission will consider in determining whether to
designate a professional certification or designation or credential
from an accredited educational institution as qualifying for accredited
investor status:
<bullet> The certification, designation, or credential arises out
of an examination or series of examinations administered by a self-
regulatory organization or other industry body or is issued by an
accredited educational institution, under 17 CFR 230.501(a)(10)(i)
(``Rule 501(a)(10)(i)'');
<bullet> The examination or series of examinations is designed to
reliably and validly demonstrate an individual's comprehension and
sophistication in the areas of securities and investing, under 17 CFR
230.501(a)(10)(ii) (``Rule 501(a)(10)(ii)'');
<bullet> Persons obtaining such certification, designation, or
credential can reasonably be expected to have sufficient knowledge and
experience in financial and business matters to evaluate the merits and
risks of a prospective investment, under 17 CFR 230.501(a)(10)(iii)
(``Rule 501(a)(10)(iii)''); and
<bullet> An indication that an individual holds the certification
or designation is
[[Page 63347]]
either made publicly available by the relevant self-regulatory
organization or other industry body or is otherwise independently
verifiable, under 17 CFR 230.501(a)(10)(iv) (``Rule
501(a)(10)(iv)'').\21\
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\21\ Additionally, Note 1 to paragraph 501(a)(10) specifies that
the Commission will designate professional certifications or
designations or credentials as qualifying such holders as accredited
investors by order, after notice and an opportunity for public
comment.
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In proposing Rule 501(a)(10), the Commission noted prior
recommendations to designate CFP certifications as qualifying natural
persons for accredited investor status, but did not include them in the
proposed list of certifications or designations to be included in an
initial Commission order accompanying the final rule, if adopted.\22\
In response, the Certified Financial Planner Board of Standards, Inc.
(``CFP Board''), which oversees the CFP certification in the United
States, recommended the inclusion of the CFP on the initial list of
professional certifications, designations, and credentials.\23\
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\22\ See Amending the ``Accredited Investor'' Definition,
Release No. 33-10734 (Dec. 18, 2019) [85 FR 2574, 2579-2581 (Jan.
15, 2020)] (the ``Accredited Investor Proposing Release'').
\23\ See letter from Kevin R. Keller, CAE, Chief Executive
Officer, CFP Board; Lauren Schadle, CAE, Executive Director/CEO,
FPA; and Geoffrey Brown, CAE, Chief Executive Officer, NAPFA (Mar.
16, 2020) (``Financial Planning Coalition''). The comment letters to
the Accredited Investor Proposing Release are available at <a href="https://www.sec.gov/comments/s7-25-19/s72519.htm">https://www.sec.gov/comments/s7-25-19/s72519.htm</a>. CFP certifications are in
part facilitated by the Financial Planning Standards Board Ltd.
(``FPSB''), which developed a ``framework of professional
competency, ethics and practice standards and rigorous certification
requirements that are adapted locally by each FPSB affiliate
organization to ensure that a CFP professional is appropriately
qualified and assessed to provide financial planning advice in a
given territory'' that is administered through affiliate
organizations. See FPSB Member Organizations, available at <a href="https://fpsb.org/about-financial-planning/find-a-planner/">https://fpsb.org/about-financial-planning/find-a-planner/</a> (last retrieved
Sept. 24, 2026). The CFP Board is the affiliated organization with
oversight of the United States. Because the CFP Board's exams and
oversight of CFPs only applies to CFPs in the United States, we are
limiting our discussion to CFPs in the United States and currently
only considering potentially designating CFPs in the United States.
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The CFP Board specifically noted ways in which it believed that the
CFP certification would satisfy the requirements of Rule 501(a)(10),
including that ``CFP[supreg] certification requires gaining not only
substantial educational and professional experience, meeting continuing
education requirements, and adhering to high professional and ethical
standards enforced through a disciplinary process with public
sanctions; but also requires passing a rigorous professional
examination designed to test competency in financial planning'';
``[t]he CFP[supreg] examination is designed to reliably and validly
demonstrate an individual's comprehension and sophistication in the
areas of securities and investing, such as quantitative investment
concepts, measures of investment returns, asset allocation and
portfolio diversification, bond and stock valuation concepts, portfolio
development and analysis, investment strategies, and alternative
investments''; and ``CFP[supreg] professionals can be verified online
through CFP Board's website.'' \24\
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\24\ See letter from Financial Planning Coalition (discussing
the CFP certification requirements, including required education,
work experience, and exam, and their relevance to the non-exclusive
list of attributes listed in Rule 501(a)(10)).
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Other commenters also generally supported the inclusion of
CFPs.\25\ One of those commenters stated that the ``CFP certification
generally require[s] the mastery of a broader range of material at a
deeper level than the series 7 exam and, therefore better equip[s] a
person to evaluate investments.'' \26\ Another commenter stated ``[the
CFP certification] brings with it a level of expertise that we believe
demonstrates an individual's comprehension and sophistication in the
areas of securities and investing, and thus obviates the need for
various restrictions on their investment choices.'' \27\
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\25\ See, e.g., letter from James J. Angel (Mar. 3, 2020);
letter from Association of Trust Organizations, Inc. (Apr. 15,
2020); letter from David R. Burton (May 1, 2020) (``D. Burton'');
letter from Carta, Inc. (Mar. 16, 2020) (``Carta''); letter from
HLWG (Mar. 16, 2020); letter from Chris Lakumb (Dec. 18, 2019);
letter from Mercer Advisors (Mar. 11, 2020); letter from G. Philip
Rutledge (Jan. 31, 2020).
\26\ See letter from D. Burton.
\27\ See letter from Carta.
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Consistent with the proposal, at the time of adoption of Rule
501(a)(10), the Commission issued an order designating the General
Securities Representative license (Series 7), Private Securities
Offerings Representative license (Series 82), and Investment Adviser
Representative license (Series 65) as qualifying a holder of such
licenses in good standing for accredited investor status.\28\ In the
Accredited Investor Adopting Release, the Commission expressly noted
that ``[a]lthough other professional certifications, designations, and
credentials, such as other FINRA exams, a specific accredited investor
exam, other educational credentials, or professional experience
received broad commenter support, we are taking a measured approach to
the expansion of the definition . . . . [and] we believe it is
appropriate to consider these other credentials after first gaining
experience with the revised rules.'' \29\
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\28\ The exams for the General Securities Representative license
(Series 7) and the Private Securities Offerings Representative
license (Series 82) are developed and administered by the Financial
Industry Regulatory Authority (``FINRA''), and the exam for the
Investment Adviser Representative license (Series 65) was developed
by the North American Securities Administrators Association and is
administered by FINRA. See Order Designating Certain Professional
Licenses as Qualifying Natural Persons for Accredited Investor
Status, Release No. 33-10823 (Aug. 26, 2020) [85 FR 64234 (Oct. 9,
2020)].
\29\ Accredited Investor Adopting Release at 64243.
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The Commission has now had over five years of experience with the
initially designated professional licenses. There is no evidence that
we are aware of to suggest that the expansion in 2020 of the accredited
investor definition to include these types of financially sophisticated
investors has created investor protection concerns. Since the adoption
of Rule 501(a)(10) and the initial designations, the Commission has
received recommendations to further expand the number of investors that
qualify as accredited investors under Rule 501(a)(10).\30\ The
arguments in some of these recommendations echo the arguments contained
in letters from commenters in connection with the adoption of Rule
501(a)(10), which stated that the definition limits access to private
investments primarily to those who are wealthy,\31\ have close ties to
the
[[Page 63348]]
issuer,\32\ or have certain jobs in the financial industry.\33\ The
Commission has also received petitions for rulemaking requesting
changes to the accredited investor definition.\34\
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\30\ See, e.g., Report on the 45th Annual Small Business Forum
(July 27, 2026) at 17, available at <a href="https://www.sec.gov/files/2026-oasb-annual-forum-report.pdf">https://www.sec.gov/files/2026-oasb-annual-forum-report.pdf</a> (recommending that the Commission
``expand the accredited investor definition to include additional
measures of sophistication, including through an investor test and
experience''); Report on the 44th Annual Small Business Forum (Sept.
22, 2025) at 18, available at (recommending that the Commission
``[e]xpand the accredited investor definition to include additional
measures of sophistication''); SEC Small Business Capital Formation
Advisory Committee Recommendation regarding the Accredited Investor
Definition (May 1, 2024), available at <a href="https://www.sec.gov/files/recs-accredited-investor-definition.pdf">https://www.sec.gov/files/recs-accredited-investor-definition.pdf</a> (recommending in part that
persons not meeting the definition be able to undertake an
educational program, which would allow them to invest a percent of
their assets); OASB, Annual Report for Fiscal Year 2023 at 75,
available at <a href="https://www.sec.gov/files/2023-oasb-annual-report.pdf">https://www.sec.gov/files/2023-oasb-annual-report.pdf</a>
(recommending expansion of the accredited investor definition to add
qualitative professional criteria and alternative ways to
demonstrate financial sophistication). See also SEC Investor
Advisory Committee Recommendation regarding Retail Investor Access
to Private Market Assets (Sept. 18, 2025), available at <a href="https://www.sec.gov/files/iac-recommendation-private-market-assets-final-09182025.pdf">https://www.sec.gov/files/iac-recommendation-private-market-assets-final-09182025.pdf</a> (not taking a position on whether the accredited
investor definition should be expanded, but recommending that, if
the definition were to be expanded, the Commission consider
expanding the accredited investor definition to cover additional
professional certifications or designations or credentials,
including the CFP).
\31\ See, e.g., letter from D. Burton (stating that ``people
outside of the financial industry should have a means to prove that
they have the knowledge and sophistication to qualify as [accredited
investors] . . . . [o]therwise, the Commission will effectively
creat[e] barriers where only affluent people or those it regulates
in the financial industry have access to these investments.'');
letter from Tron Black (Nov. 20, 2019, last updated Dec. 24, 2019).
\32\ See, e.g., letter from Bruce A. Wallick (Dec. 19, 2019)
(stating that the ``[accredited investor definition] should include
an opportunity for self-taught investors to demonstrate their
financial sophistication and achieve accredited status.''); letter
from D. Burton.
\33\ See, e.g., letter from Crowdwise, LLC (Mar. 1, 2020)
(stating that it is crucial for the Commission to ``consider how
self-taught, sophisticated investors who do not have any other
financial credentials (nor the ability to get them) or finance
industry experience can still have access to the same investment
opportunities that are available to accredited investors today.'');
letter from D. Burton (stating that expansion of the accredited
investor definition ``will help investors that would typically
otherwise be barred from investing in Regulation D offerings (most
often younger investors or those that live outside of high-income
metropolitan areas).'').
\34\ See Benjamin Bartel, Petition for Rulemaking to Amend the
Accredited Investor Definition in Rule 501(a) of SEC Regulation D
(Sept. 25, 2025), available at <a href="https://www.sec.gov/files/rules/petitions/2025/petn4-871.pdf">https://www.sec.gov/files/rules/petitions/2025/petn4-871.pdf</a>; Fabricio R. Murillo Garcia, Petition
for Modification of Definition of Accredited Investors (Feb. 13,
2024), available at <a href="https://www.sec.gov/files/rules/petitions/2024/petn4-823.pdf">https://www.sec.gov/files/rules/petitions/2024/petn4-823.pdf</a>; Nicholas Morgan, Investor Choice Advocates Network,
Rulemaking petition to reduce the diversity, equity, and inclusion
(``DEI'') barriers for ``accredited investors'' by replacing the net
worth and income requirements of Rule 501(a) under the Securities
Act of 1933 with non-financial metrics (Nov. 9, 2022), available at
<a href="https://www.sec.gov/files/rules/petitions/2022/petn4-796.pdf">https://www.sec.gov/files/rules/petitions/2022/petn4-796.pdf</a>; Benny
R. Brown, Request to change the rules which qualifies an individual
or individuals as an accredited investor (Apr. 26, 2021), available
at <a href="https://www.sec.gov/files/rules/petitions/2021/petn4-773.pdf">https://www.sec.gov/files/rules/petitions/2021/petn4-773.pdf</a>. The
Commission has considered these petitions in connection with this
notice and the other notices published elsewhere in this issue of
the Federal Register. See infra note 35.
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For the reasons set forth in section II, we believe that holding a
CFP certification in the United States in good standing would satisfy
the standard in Rule 501(a)(10).\35\ Accordingly, as required by Rule
501(a)(10), we are providing notice and an opportunity for public
comment on potential designation of holding a CFP certification in the
United States in good standing as qualifying natural persons for
accredited investor status.\36\
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\35\ We are also concurrently providing notice pursuant to Note
1 to paragraph 501(a)(10) with respect to the potential designation
of each of the following as qualifying natural persons for
accredited investor status: the passage of an accredited investor
exam to be developed by FINRA; holding a license as a U.S. certified
public accountant in good standing; holding a charter as a Chartered
Financial Analyst in good standing; and the Investment Banking
Representative license (Series 79) and the Research Analyst license
(Series 86 and Series 87). See Potential Designation of Passage of
an Accredited Investor Exam to be Developed by FINRA as Qualifying
Natural Persons for Accredited Investor Status; Potential
Designation of U.S. Certified Public Accountant License as
Qualifying Natural Persons for Accredited Investor Status; Potential
Designation of Chartered Financial Analyst Designation as Qualifying
Natural Persons for Accredited Investor Status; Potential
Designations of the Investment Banking Representative License
(Series 79) and the Research Analyst License (Series 86 and Series
87) as Qualifying Natural Persons for Accredited Investor Status
published elsewhere in this issue of the Federal Register.
\36\ As is the case for the other prongs of the accredited
investor definition, individuals holding a CFP certification in the
United States in good standing would only themselves qualify as
accredited investors and could not rely on their status as
accredited investors to purchase securities on behalf of another
person.
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II. Discussion
A. CFP Certification Requirements
1. Background
We believe designating holding a CFP certification in the United
States in good standing as qualifying natural persons for accredited
investor status would be consistent with the standard in Rule
501(a)(10) because the CFP certification meets the non-exclusive
attributes the Commission identified in Rule 501(a)(10) as relevant to
its consideration of adding additional professional certifications or
designations or credentials.
In the United States, the CFP certification is issued by the CFP
Board, a credentialing body in the financial services industry.\37\ In
order to be a CFP, an individual generally must meet educational and
work experience requirements as well as pass the CFP exam (the
``Exam'').\38\ The Exam tests CFP candidates' knowledge and skills in
the areas identified by the CFP Board as relevant to the CFP
certification, which the CFP Board refers to as the ``Principal
Knowledge Topics.'' \39\ The CFP Board is responsible for developing
and scoring the Exam.
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\37\ The CFP Board is made up of two affiliated non-profit
organizations, with the relevant one for purpose of this notice
being the CFP Board of Standards that credentials financial planners
through the CFP certification. See CFP Board, Mission & Priorities,
available at <a href="https://www.cfp.net/about-cfp-board/mission-and-priorities">https://www.cfp.net/about-cfp-board/mission-and-priorities</a> (last retrieved Sept. 24, 2026).
\38\ See CFP Board, The Certification Process (``Certification
Process''), available at <a href="https://www.cfp.net/certification-process">https://www.cfp.net/certification-process</a>
(last retrieved Sept. 24, 2026). The CFP Board has approved more
than 300 programs and will also accept requests to review a
candidate's previously completed coursework. See also CFP Board,
Certification Coursework Requirement, available at <a href="https://www.cfp.net/certification-process/education-requirement/certification-coursework-requirement">https://www.cfp.net/certification-process/education-requirement/certification-coursework-requirement</a> (last retrieved Sept. 24,
2026); CFP Board, Transcript Review, available at <a href="https://www.cfp.net/certification-process/education-requirement/certification-coursework-requirement/transcript-review">https://www.cfp.net/certification-process/education-requirement/certification-coursework-requirement/transcript-review</a> (last
retrieved Sept. 24, 2026).
\39\ See letter from Financial Planning Coalition. See also CFP
Board, Candidate Guide (Oct. 2026) (``Candidate Guide'') at 5-6, 19-
20, available at <a href="https://www.cfp.net/-/media/files/cfp-board/cfp-certification/exam/exam-candidate-handbook.pdf">https://www.cfp.net/-/media/files/cfp-board/cfp-certification/exam/exam-candidate-handbook.pdf</a> (last retrieved Sept.
24, 2026).
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As of September 1, 2026, the CFP Board estimates there are over
110,000 holders of the CFP certification in the United States.\40\
Additionally, the CFP Board has reported more CFP candidates sat for
the July 2026 Exam than any prior exam.\41\
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\40\ See CFP Board, CFP Professional Demographics (Sept. 1,
2026), available at <a href="https://www.cfp.net/industry-insights/reports-and-statistics/professional-demographics">https://www.cfp.net/industry-insights/reports-and-statistics/professional-demographics</a> (last retrieved Sept. 24,
2026).
\41\ See CFP Board, The Financial Planning Profession's Momentum
Continues with Another Record CFP Exam (Aug. 18, 2026), available at
<a href="https://www.cfp.net/news/2026/08/the-financial-planning-professions-momentum-continues-with-another-record-cfp-exam">https://www.cfp.net/news/2026/08/the-financial-planning-professions-momentum-continues-with-another-record-cfp-exam</a> (last retrieved
Sept. 24, 2026). If the number of candidates continues to increase,
this could lead to an increase in the number of persons that hold a
CFP certification in the United States in good standing.
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2. Educational and Work Experience Requirements
In connection with obtaining a CFP certification, a candidate must
complete two educational requirements. First, prior to taking the Exam,
a CFP candidate must complete the coursework on financial planning
through a CFP Board registered program, which covers the knowledge
tested by the Exam.\42\ Holders of certain professional certifications
or advanced degrees may apply to skip some or all of this required
coursework.\43\ Second, a CFP candidate must have obtained, or within
five years of passing the Exam obtain, their bachelor's degree.\44\
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\42\ See supra note 38. See also infra section II.A.3.i for a
discussion of the topics tested on the Exam.
\43\ The CFP Board refers to this as the ``Accelerated Path.''
The professionals that may be eligible include, but are not limited
to: certified public accountants; chartered financial analysts;
licensed attorneys; and Ph.D.s in Financial Planning, Business
Administration, or Economics. See CFP Board, Accelerated Path: Get
Certified Faster, available at <a href="https://www.cfp.net/certification-process/education-requirement/certification-coursework-requirement/accelerated-path">https://www.cfp.net/certification-process/education-requirement/certification-coursework-requirement/accelerated-path</a> (last retrieved Sept. 24, 2026).
\44\ See Certification Process.
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To obtain a CFP certification, there is also a work experience
requirement, which is limited to activities involving the delivery of
financial planning services to individual clients.\45\ A CFP
[[Page 63349]]
candidate is required to complete either 6,000 hours of work
experience, or 4,000 hours of work experience if done in connection
with an apprenticeship that is directly supervised by a CFP.\46\ The
work experience must have occurred within 10 years prior to or within
five years after passing the Exam.\47\
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\45\ The specific types of work experience that meet the work
experience requirement include: directly working in personal
financial planning, directly engaging with personal financial
planners, or conducting tasks in support of the personal financial
planning process. Hours of work activities that do not relate to the
personal financial planning process for clients (such as time spent
in corporate finance, training, practice management, marketing,
software development or administrative duties) cannot be counted
toward the work experience requirement. See CFP Board, The Paths to
Experience, available at <a href="https://www.cfp.net/certification-process/experience-requirement/the-paths-to-experience">https://www.cfp.net/certification-process/experience-requirement/the-paths-to-experience</a> (last retrieved Sept.
24, 2026).
\46\ The supervising CFP must attest to the CFP candidate's work
experience, and the experience must be verified by the CFP Board.
See id.
\47\ See id.
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3. Exam
i. Contents
The Exam is designed to assess CFP candidates' ability to apply
financial knowledge and ``ensure that [they] are highly qualified to
develop a holistic plan for [their] clients' finances.'' \48\ The Exam
tests financial planning related knowledge and skills through 170
questions over a six-hour period. Specifically, the Exam contains the
following sections:
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\48\ CFP Board, The CFP Exam Requirement, available at <a href="https://www.cfp.net/certification-process/exam-requirement">https://www.cfp.net/certification-process/exam-requirement</a> (last retrieved
Sept. 24, 2026).
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<bullet> Professional Conduct and Regulation (approximately eight
percent of the Exam): covering, among other things, general financial
services regulations and rules, and CFP Board specific ethics and
rules;
<bullet> General Principles of Financial Planning (approximately 15
percent of the Exam): covering, among other things, financial
statements, cash flow management, economic concepts, and the time value
of money;
<bullet> Risk Management and Insurance Planning (approximately 11
percent of the Exam): covering, among other things, principles of risk
and insurance, and analysis and evaluation of risk exposures; and
various types of insurance (e.g., health insurance, disability income
insurance, and long-term care insurance);
<bullet> Investment Planning (approximately 17 percent of the
Exam): covering, among other things, types of investment risk; market
cycles; quantitative investment concepts and measures of investment
returns; asset allocation and portfolio diversification; and
characteristics, uses, and taxation of investment vehicles;
<bullet> Tax Planning (approximately 14 percent of the Exam):
covering, among other things, fundamental and current tax laws, income
tax fundamentals and calculations, and characteristics and income
taxation of business entities;
<bullet> Retirement Saving and Income Planning (approximately 18
percent of the Exam): covering, among other things, retirement needs
analysis, Social Security and Medicare planning, eldercare and special
needs planning, and types of retirement plans;
<bullet> Estate Planning (approximately 10 percent of the Exam):
covering, among other things, property titling and beneficiary
designations and strategies to transfer property; and
<bullet> Psychology of Financial Planning (approximately seven
percent of the Exam): covering behavioral finance, among other
things.\49\
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\49\ See Candidate Guide at 19-20.
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As part of the CFP Board's development of the Exam, it conducts a
``Practice Analysis Study,'' which the CFP Board describes as the
``largest research project in the U.S. related to the body of knowledge
for financial planning;'' the CFP Board uses this study to verify and
update its Principal Knowledge Topics.\50\
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\50\ The ``Practice Analysis Study'' is conducted approximately
every five years, with the results of the most recent one released
in 2021. See CFP Board, Practice Analysis Study (``Practice Analysis
Study''), available at <a href="https://www.cfp.net/certification-process/practice-analysis-study">https://www.cfp.net/certification-process/practice-analysis-study</a> (last retrieved Sept. 24, 2026). See also
supra notes 48-49 and the accompanying text (discussing in detail
the Principal Knowledge Topics). The Practice Analysis Study
``incorporates a multi-method approach that includes a number of
subject-matter experts, an analysis of emerging trends in the
profession, . . . a large-scale survey of practicing CFP[supreg]
professionals and educators from CFP Board Registered Programs,
[and] research with firms that hire CFP[supreg] professionals as
well as clients of CFP[supreg] professionals.'' Practice Analysis
Study.
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ii. Administration of the Exam
The CFP candidate applies to take the Exam through the CFP Board;
however, the delivery of the Exam is handled by a third party.\51\ The
current standard registration fee is $925.\52\ The Exam is administered
three times a year, during an eight-day period in March, July, and
October/November, and may be taken at a designated testing center.\53\
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\51\ See Candidate Guide at 8.
\52\ See Candidate Guide at 3. In addition, depending on how
close to the Exam window the request is made, rescheduling for a
different test date within the Exam window may cost up to $100;
however, to the extent the CFP Candidate desires to postpone the
Exam until new Exam window, the fee is approximately $500. See
Candidate Guide at 9-10.
\53\ See Candidate Guide at 3. Through July 2026, remote testing
was available for the Exam. However, beginning with the Oct./Nov.
2026 Exam window, remote testing will only be available to
candidates whose ``home address [is] more than 60 miles from the
nearest [designated testing center]'' or who have ``[a]n at-risk
medical condition or physical limitation that requires remote
testing.'' See CFP Board, CPA Exam: Remote Proctoring, available at
<a href="https://www.cfp.net/certification-process/exam-requirement/registration/remote-proctoring-faq">https://www.cfp.net/certification-process/exam-requirement/registration/remote-proctoring-faq</a> (last retrieved Sept. 24, 2026).
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4. Additional Requirements
In order to maintain an active CFP certification, a person must
complete 30 credit hours of Continuing Education (``CE'') every two
years.\54\ CE credit may be earned by attending educational programs
and conferences that cover Principal Knowledge Topics and are not
otherwise excluded from CE credit.\55\ Additionally, the CFP Board may
approve CE credit for authoring publications or teaching.\56\ In
connection with obtaining a CFP certification, a CFP candidate must
``demonstrate ethical fitness'' and commit to ongoing compliance with
the CFP Board's Code of Ethics.\57\
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\54\ This requirement will increase to 40 hours in the last
quarter of calendar year 2027, but will only apply to the first two
year renewal cycle beginning after that date. See CFP Board, CFP
Board Announces Updates to the Competency Standards (Jan. 27, 2026,
updated Sept. 1, 2026) (``Competency Standards Update''), available
at <a href="https://www.cfp.net/news/2026/01/cfp-board-announces-updates-to-the-competency-standards">https://www.cfp.net/news/2026/01/cfp-board-announces-updates-to-the-competency-standards</a> (last retrieved Sept. 24, 2026).
\55\ Excluded topics consist of practice management, public
accounting, computer hardware and software, marketing or
prospecting, sales, specific company or product presentations. See
CFP Board, Program Requirements (``Program Requirements''),
available at <a href="https://www.cfp.net/for-education-partners/continuing-education-providers/ce-sponsors/submit-a-program/program-requirements">https://www.cfp.net/for-education-partners/continuing-education-providers/ce-sponsors/submit-a-program/program-requirements</a> (last retrieved Sept. 24, 2026). Effective in the last
quarter of calendar year 2027, practice management will not be an
excluded topic and up to five hours of CE credit will be permitted.
See also Competency Standards Update.
\56\ See Program Requirements.
\57\ CFP Board, Fitness Standards for Candidates for CFP
Certification and Former CFP Professionals Seeking Reinstatement
(June 1, 2026), available at <a href="https://www.cfp.net/-/media/files/cfp-board/standards-and-ethics/2026-proposed-revisions/cfp-board-fitness-standards-june-2026.pdf">https://www.cfp.net/-/media/files/cfp-board/standards-and-ethics/2026-proposed-revisions/cfp-board-fitness-standards-june-2026.pdf</a> (last retrieved Sept. 24, 2026).
Certain prior conduct constitutes an absolute bar to obtaining a CFP
certification. There are other types of conduct that may render a
CFP candidate currently ineligible for a CFP certification or that
would require a CFP candidate to file a petition regarding their
fitness for a CFP certification.
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5. Public Verification
The CFP Board maintains a website that allows the public, at no
cost, to search for individuals who currently hold a CFP
certification.\58\
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\58\ See CFP Board, Verify an Individual's CFP Certification and
Background, available at <a href="https://www.cfp.net/verify-a-cfp-professional">https://www.cfp.net/verify-a-cfp-professional</a>. See also infra note 61.
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B. Rationale for Designation
1. Rule 501(a)(10) Generally and Rule 501(a)(10)(i)
We believe it would be appropriate to designate holding a CFP
certification in the United States in good standing as a professional
certification that qualifies an individual for accredited investor
status pursuant to Rule 501(a)(10). The addition of holding a CFP
certification
[[Page 63350]]
in the United States in good standing as a designated professional
certification would provide an additional knowledge-based means for
individuals to qualify as accredited investors while appropriately
balancing investor protection concerns.\59\
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\59\ As the Commission stated in connection with adoption of
Rule 501(a)(10) ``[w]e believe that the amendments we are adopting
in [the Accredited Investor Adopting Release] provide appropriate
investor protections while facilitating capital formation.'' See
Accredited Investor Adopting Release at 64256. See also supra note
20.
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Rule 501(a)(10) requires that any professional certifications and
designations and other credentials designated as qualifying such holder
for accredited investor status be held in good standing.\60\ We believe
that the standards set by the CFP Board for a CFP certification holder
to retain their certification, which include the completion of CE as
described in section II.A.4, are an appropriate measure of good
standing. Accordingly, any persons prohibited from holding themselves
out to the public as being certified by the CFP Board either through
failure to renew their CFP certification or due to CFP Board
disciplinary action would not be considered in good standing.\61\
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\60\ See supra note 19.
\61\ The CFP certification does not have an inactive category.
See CFP Board, FAQs, Question 16, available at <a href="https://www.cfp.net/for-cfp-pros/continuing-education/faqs">https://www.cfp.net/for-cfp-pros/continuing-education/faqs</a> (last retrieved Sept. 24,
2026). See also CFP Board, Procedural Rules (June 1, 2026) at 24,
available at <a href="https://www.cfp.net/-/media/files/cfp-board/standards-and-ethics/2026-proposed-revisions/cfp-board-procedural-rules-june-2026.pdf">https://www.cfp.net/-/media/files/cfp-board/standards-and-ethics/2026-proposed-revisions/cfp-board-procedural-rules-june-2026.pdf</a> (last retrieved Sept. 24, 2026).
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Rule 501(a)(10)(i) additionally requires that a designated
certification, designation, or credential arise out of an examination
or series of examinations administered by a self-regulatory
organization or other industry body or be issued by an accredited
educational institution. As described in section II.A.1, the Exam,
which is a prerequisite to holding a CFP certification in the United
States in good standing,\62\ is designed by the CFP Board.\63\ Although
``other industry body'' is not defined in Rule 501(a)(10), we believe
that the CFP Board is an industry body as contemplated under Rule
501(a)(10) due to its role in setting best practices in the financial
planning industry.
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\62\ See supra note 43 (discussing the Accelerated Path
available to certain CFP candidates).
\63\ See supra note 37.
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2. Rules 501(a)(10)(ii) and 501(a)(10)(iii)
Rule 501(a)(10)(ii) states that the Commission will consider
whether ``[t]he examination or series of examinations is designed to
reliably and validly demonstrate an individual's comprehension and
sophistication in the areas of securities and investing.'' Rule
501(a)(10)(iii) states the Commission will consider whether ``[p]ersons
obtaining [a] certification, designation, or credential [designated
under Rule 501(a)(10)] can reasonably be expected to have sufficient
knowledge and experience in financial and business matters to evaluate
the merits and risks of a prospective investment.''
We believe that passage of the Exam satisfies the objectives of
Rule 501(a)(10)(ii). We further believe that passage of the Exam
combined with the satisfaction of the requirements to obtain a CFP
certification would satisfy the objectives of Rule 501(a)(10)(iii). As
described in more detail in section II.A.3.i, the Exam is designed to
evaluate a person's knowledge and skill in the area of financial
planning, which includes advising clients on investments. The Principal
Knowledge Topics covered by the Exam encompass various topics that are
particularly relevant to an individual's comprehension and
sophistication in the areas of securities and investing. For example,
the General Principles of Financial Planning section tests knowledge
and skills related to financial statements, cash flow management,
economic concepts, and the time value of money. The Investment Planning
section tests knowledge related to types of investment risk; market
cycles; quantitative investment concepts and measures of investment
returns; asset allocation and portfolio diversification; and
characteristics, uses, and taxation of investment vehicles.\64\
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\64\ Further, in addition to the Exam, to obtain a CFP
certification, CFP candidates must meet both educational
requirements described above. See supra section II.A.2.
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In addition to passage of the Exam, as described in more detail in
section II.A.2, to be eligible to obtain a CFP certification, the CFP
candidate must have the required educational and work experience. We
therefore believe that in obtaining a CFP certification, through the
combination of the Exam and obtaining the required educational
experience and work experience, such persons will have demonstrated
that they have the comprehension and sophistication to evaluate the
merits and risks of investment opportunities, and ultimately,
appropriately allocate capital based on their individual circumstances,
and otherwise make appropriately informed decisions regarding their
financial interests.\65\ Moreover, we believe that the CE requirement
further supports that holders of a CFP certification in the United
States in good standing have sufficient knowledge and experience in
financial and business matters to evaluate the merits and risks of a
prospective investment.\66\
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\65\ See Accredited Investor Adopting Release at 64241.
\66\ See supra section II.A.4.
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3. Rule 501(a)(10)(iv)
Rule 501(a)(10)(iv) states the Commission will consider whether
``[a]n indication that an individual holds the certification or
designation is either made publicly available by the relevant self-
regulatory organization or other industry body or is otherwise
independently verifiable.'' As described in section II.A.5, the public
may use the CFP Board website to verify whether any person holds a CFP
certification in the United States in good standing.
C. Economic Considerations
As discussed above, we are considering whether to add a CFP
certification in the United States in good standing to the list of
designated professional certifications, designations, or credentials
that would qualify natural persons for accredited investor status under
Rule 501(a)(10). Thus, individuals who hold such a certification would
qualify as accredited investors and would be able to participate in
investment opportunities that may not otherwise have been available to
them, unless they were already accredited investors based on another
criterion. This change could also impact issuers seeking to raise
capital.\67\ The designation of CFP certification holders in the United
States in good standing as accredited investors would have economic
effects on investors and issuers that would be consistent with those
the Commission discussed in creating the Rule 501(a)(10) designation
process in the Accredited Investor Adopting Release.\68\
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\67\ To the extent that the accredited investor definition is
used outside of the Federal securities laws (such as for non-Federal
securities laws that incorporate the accredited investor
definition), the designation of additional credentials might have
indirect economic effects.
\68\ See Accredited Investor Adopting Release at section VI.
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It is difficult to quantify how many additional natural persons
would qualify as accredited investors because we cannot gauge how many
of the CFP holders \69\ already qualify as accredited investors based
on one or more of the
[[Page 63351]]
other eligibility criteria in Rule 501(a), such as those for net worth,
income, and other qualifying professional certifications, designations,
or credentials.\70\ Further, it is unclear to what extent any newly
eligible accredited investors will choose to participate in exempt
offerings.
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\69\ As of Sept. 1, 2026, the CFP Board estimates there are over
110,000 U.S. holders of the CFP certification. Additionally, the CFP
Board has reported a record number of CFP candidates sat for the
July 2026 Exam. See supra notes 40-41 and accompanying text.
\70\ For instance, some investors that would qualify based on
holding a CFP certification in good standing may already qualify as
accredited investors based on income or net worth criteria in Rule
501. Such individuals also may hold other licenses or credentials
that are already designated, or that we are potentially designating,
under Rule 501(a)(10). See supra note 35. In that scenario, the CFP
category may not contribute to a meaningful net expansion of the
pool of accredited investors. According to the CFP Board's
Compensation Study, the median income for CFP financial planners in
the survey was $195,000 in 2025, but it highly depends on
experience, with median income for CFP financial planners with less
than 5 years of experience of $115,000; 5-10 years of experience--
$160,000; 11-20 years of experience--$255,000; and over 20 years--
$360,000. See CFP Bd., 2026 Compensation Study (June 2026),
available at <a href="https://www.cfp.net/-/media/files/cfp-board/career-and-growth/2026-cfp-compensation-study-public.pdf">https://www.cfp.net/-/media/files/cfp-board/career-and-growth/2026-cfp-compensation-study-public.pdf</a> (last retrieved Sept.
24, 2026).
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Issuers are expected to benefit from the expansion of the
accredited investor definition under Rule 501(a)(10) through
potentially greater capital formation, lower cost of capital, and
greater efficiency in raising capital due to an expanded pool of
accredited investors (especially for issuers that are small or do not
have access to a network of institutional accredited investors or
persons with the required net worth or income to qualify as accredited
investors).\71\ This change may also benefit issuers in exempt
offerings by making it easier and less costly to find and verify
accredited investors (i.e., by reducing search costs).\72\ As discussed
in section II.A.5, holding a CFP certification in the United States in
good standing could be easily independently verified, which would
directly reduce issuers' costs of confirming accredited investor
eligibility, relative to verifying income or net worth.\73\ This is
expected to benefit issuers and intermediaries in exempt offerings
where only accredited investors may be purchasers (such as Rule 506(c))
or where some provisions, such as limits on the number of purchasers or
investment limits, are dependent on accredited investor status (e.g.,
Rule 506(b), Regulation A, and Regulation Crowdfunding). However, to
the extent that issuers would have otherwise pursued additional
financing from accredited investors meeting the existing definition or
engaged in an offering that is not dependent on accredited investor
participation (such as a registered securities offering), the amount of
additional capital formation may be limited. Still, issuers may benefit
from greater flexibility in how they may raise capital, which could
result in some cost savings and a lower cost of capital. For instance,
issuers undertaking a Rule 506(b) offering may incur lower costs if all
of their purchasers are accredited investors as compared to if not all
of their purchasers are accredited investors, as the rule would not
require them to furnish the financial and other information prescribed
by Rule 502(b) for offerings involving non-accredited investors.\74\
For issuers in Rule 506(c) offerings, verification of accredited
investor status based on a credential that is easier to confirm may be
less costly than verification of other prongs of the accredited
investor definition (such as financial eligibility), reducing their
transaction costs.\75\ For issuers that undertake a Tier 2 Regulation A
or Regulation Crowdfunding offering, both of which are subject to
investment limits for non-accredited investors, having more accredited
investors in the offering enables higher investment amounts per
investor, which may decrease all-in offering costs.\76\ Issuers
choosing among different exempt offering alternatives may choose a
Regulation D offering if they have enough prospective investors that
meet the accredited investor definition, instead of pursuing a
Regulation A or Regulation Crowdfunding offering, potentially lowering
their compliance, intermediary, and marketing costs-per-dollar raised.
Some issuers choosing between an exempt and a registered offering may
choose an exempt offering if they have enough prospective investors
that meet the accredited investor definition, instead of pursuing a
registered offering.
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\71\ See Accredited Investor Adopting Release at 64264-65.
\72\ See Accredited Investor Adopting Release at 64264.
\73\ See supra note 58 and accompanying text. Thus, even if some
CFP holders already meet other accredited investor eligibility
criteria, the overall costs of verification of accredited investor
status may decrease with the designation of this credential under
Rule 501(a)(10).
\74\ See 17 CFR 230.502(b).
\75\ See 17 CFR 230.506(c)(1) through 230.506(c)(2).
\76\ See 17 CFR 230.251(d)(2)(i)(C); 17 CFR 227.100(a)(2).
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For investors, the designation of this credential as a means of
becoming an accredited investor could enable more natural persons who
would not otherwise meet one of the eligibility criteria in Rule
501(a), such as the income and net worth criteria, to access a broader
range of investment options, potentially enhancing their ability to
diversify and optimize portfolio allocations.\77\
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\77\ As noted above, the extent of overlap between CFPs and the
investors that meet the existing accredited investor criteria is
unclear. Credential holders who are earlier in their careers,
employed at smaller firms, or located in lower cost-of-living
geographic areas, and thus may on average have lower incomes, may be
most affected by the potential designation. Some investors that
already meet income or net worth criteria may find it is easier or
less costly to demonstrate their accredited investor status under
Rule 501(a)(10).
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However, these investment options generally come without the
additional disclosure provided by registration under the Securities Act
and could entail greater costs related to illiquidity,\78\ agency costs
(i.e., costs arising from conflicts of interest between investors and
managers), adverse selection, and business risk, as compared to
investments in the public capital markets. Individual investors'
comprehension and sophistication in the areas of securities and
investing, and knowledge and experience in financial and business
matters, as reflected in having a professional certification or
designation or credential under Rule 501(a)(10), increases the
likelihood that such individual investors would be capable of
evaluating the merits and risks of a prospective investment in an
exempt offering and managing such risks. For example, such individuals
may be more likely to consider the size of any single investment
relative to their overall portfolio and diversify their portfolio.\79\
It is unclear whether additional investment opportunities would improve
portfolio efficiency for newly eligible accredited investors.
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\78\ While securities sold in an exempt offering are generally
illiquid, the introduction of a larger pool of investors that become
eligible as accredited investors through the CFP certification could
potentially (at the margin) create impetus for additional secondary
market liquidity in these securities. In addition, the expansion of
the accredited investor pool also would potentially increase the
feasibility of resales under section 4(a)(7) of the Securities Act
[15 U.S.C. 77d(a)(7)]. However, if some newly eligible investors
have fewer financial resources (see infra note 79), they may be less
willing to hold restricted securities over long holding periods, and
especially, seek to unload positions during downturns.
\79\ As stated in the Accredited Investor Adopting Release,
while certain of these individuals may have fewer financial
resources and, as a result, be less able to bear the financial risk
of private investments, we believe their professional credentials
and experience should enable these investors to assess investment
opportunities, appropriately allocate capital based on their
individual circumstances, including whether to reallocate investment
capital between private investments and other equivalent-sized
investments, and otherwise make appropriately informed decisions
regarding their financial interests, including their ability to bear
the financial risk. See Accredited Investor Adopting Release at
64241.
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While individuals incur costs to prepare for and take the Exam, and
[[Page 63352]]
obtain and maintain an active CFP certification in the United States in
good standing, we do not expect there to be incremental costs of a CFP
certification in the United States in good standing being designated as
an accredited investor credential under Rule 501(a)(10), since we
expect individuals to continue to pursue and maintain the CFP
certification chiefly for professional purposes, rather than to qualify
as accredited investors.
The described effects, including both the benefits and the costs to
issuers and investors, may be modest in magnitude, as discussed in
detail in the Accredited Investor Adopting Release. First, it is
possible that a number of the individuals who would qualify as
accredited investors under the potential designation may already
qualify as accredited investors based on one or more of the criteria in
Rule 501(a).\80\ Second, because any newly eligible individuals may
have income and net worth below the currently required thresholds for
individual accredited investors, the increase in the capital supply
from an individual newly eligible accredited investor would likely be
low, and the collective impact would depend on the size of any increase
in the number of individual accredited investors.\81\ Third, the
effects may be more modest to the extent that some of the newly
eligible natural persons may end up not participating in exempt
offerings.\82\ Fourth, it is possible that issuers may choose to offer
securities to institutional accredited investors, or apply investment
minimums (perhaps in an effort to simplify their capitalization table),
such that any individual accredited investors participating in exempt
offerings are more likely to be those who meet the net worth or income
criteria in Rule 501(a). Fifth, any specific effects of this potential
change to the accredited investor pool would be partly diluted to the
extent that other Commission actions designating other credentials
result in expanding the pool of natural persons qualifying as
accredited investors based on multiple criteria.
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\80\ See Accredited Investor Adopting Release at 64262.
\81\ Id.
\82\ See, e.g., Katherine Carman et al., Exploring Accredited
Investors and Private Market Securities Ownership 18 tbl. 6 (OIAD,
Working Paper No. 1, June 2025), available at <a href="https://www.sec.gov/files/exploring-accredited-investors-june-2025.pdf">https://www.sec.gov/files/exploring-accredited-investors-june-2025.pdf</a> (reporting, based
on a recent investor survey, that, 14.4% of accredited investors and
4.7% of non-accredited investors, respectively, indicate interest in
investing in new or private companies, and that 4.3% of accredited
investors and 1.1% of non-accredited investors, respectively, report
owning a ``private fund or offering''). See also Katherine Carman &
Alycia Chin, Accredited Investors in the US Population, 9 Fin. Plan.
Rev. e70023 (2026).
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III. Notice
For the reasons set forth herein, we believe that holding a CFP
certification in the United States in good standing would meet the
requirements set forth in Rule 501(a)(10). Accordingly, we believe it
is appropriate to designate holding a CFP certification in the United
States in good standing as qualifying natural persons for accredited
investor status pursuant to Rule 501(a)(10). We are issuing this notice
and providing an opportunity for public comment on such a potential
designation. We are particularly interested in comments on whether we
should designate holding a CFP certification in the United States in
good standing as qualifying natural persons for accredited investor
status pursuant to Rule 501(a)(10), as discussed in this notice, and
whether such designation could raise investor protection concerns
unique to persons who would be qualified under such designation.
By the Commission.
Dated: September 30, 2026.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2026-20309 Filed 10-2-26; 8:45 am]
BILLING CODE 8011-01-P
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