Verification of Investor Accreditation and Sophistication

What this video covers

• The 1-2-3 rule for accredited investor status: $1 million net worth, $200,000 individual income, $300,000 joint income with spouse
• Why the joint income threshold is $300,000 (not $400,000), and why the income test requires two consecutive years plus a reasonable expectation for the current year
• The primary residence exclusion from net worth, and the 60-day rule that counts new home-secured debt as a liability
• Which FINRA licenses (Series 7, Series 65, Series 82) in good standing automatically qualify a holder as accredited
• What "reasonable steps" to verify accreditation means for a registered representative on a Reg D private placement, and why self-certification alone is not enough
• The distinction between accreditation (objective financial capacity) and sophistication (subjective knowledge and experience)
• Why a wealthy but inexperienced customer can be accredited yet still unsuitable for complex products like options or structured notes