If you are an Investment Adviser Representative (IAR) and also an agent at a broker-dealer, what must be done if you receive a commission and collect an advisory fee?

When an Investment Adviser Representative (IAR) also serves as an agent at a broker-dealer and receives both a commission and an advisory fee, it is imperative to disclose the total compensation to the client. This requirement stems from the fiduciary duty that investment advisers have towards their clients, which mandates transparency and honesty in all financial dealings.

Disclosing total compensation ensures that clients are fully informed about the nature of the fees they are paying, which helps to mitigate any potential conflicts of interest. As an IAR, it is critical to adhere to regulations that promote fairness and protect clients' interests by providing them with complete and accurate information regarding how much they will be charged and what services they will receive in return. This transparency fosters trust in the advisory relationship and enables clients to make informed decisions based on a comprehensive understanding of the compensation structure.

The other possibilities do not satisfy the ethical and regulatory obligations required from an investment adviser. Reporting to the SEC isn't a requirement specific to every commission or advisory fee received. Confidentiality and selective disclosure only upon request do not uphold the standard of full disclosure mandated by regulatory bodies. Thus, ensuring clients are aware of all forms of compensation is essential to maintain compliance with industry standards and regulations.