Securities Attorney Question List — Investment Advisers Act Analysis + Marketing Copy Clearance

GitHub Issue: #3141

PREPARATION MATERIAL — NOT LEGAL ADVICE. This document is a research and briefing packet prepared for the operator to hand to a securities attorney experienced in the Investment Advisers Act of 1940 and SEC enforcement. Nothing here constitutes a legal opinion or a legal conclusion. The statutory and regulatory citations are provided to stage the conversation, not to reach a conclusion. Before making any representation about Raxx's regulatory status or publishing marketing copy, consult a securities attorney.

Last updated: 2026-07-01. Verify freshness of all regulatory citations before use.

TL;DR (3 sentences)

The central question is whether Raxx's retrospective, user-driven trade-structure enforcement and journaling product triggers "investment adviser" status under §202(a)(11) of the Investment Advisers Act of 1940. Raxx's fact pattern (no forward-looking recommendations, no autonomous execution, user-configured rules only, retrospective analysis of the user's own data) may distinguish it from a registered investment adviser — but the line is drawn by SEC interpretation and case law, not by the product's intent alone. This brief stages the statutory analysis, publisher exclusion question, marketing copy risk areas, and state-level PA considerations so the securities attorney can reach a grounded conclusion.

1. Company and Product Facts (Securities Attorney Reference Sheet)

What Raxx Does

1. User defines their own trade structure: entry criteria, position size, credit target, exit trigger, stop loss. These are the user's own rules.
2. User connects their own brokerage account (or enters trades manually).
3. Raxx records what the user actually did versus what their own rules said to do.
4. Raxx surfaces retrospective analysis: did the user follow their rules? What was the outcome when they did vs. when they deviated?
5. User optionally adds sentiment/journal notes on each trade (Shape 1 feature).

What Raxx Does NOT Do

• Does not recommend securities to buy, sell, or hold
• Does not make forward-looking price projections
• Does not execute trades on behalf of the user
• Does not hold user assets or exercise custody
• Does not provide analysis comparing securities to each other for the purpose of influencing investment decisions
• Does not provide personalized advice tailored to an individual's financial situation

2. Statutory Framework — §202(a)(11) Investment Advisers Act of 1940

Statutory Text

Section 202(a)(11) of the Investment Advisers Act of 1940 (15 U.S.C. §80b-2(a)(11)) defines "investment adviser" as:

"any person who, for compensation, engages in the business of advising others, either directly or through publications or writings, as to the value of securities or as to the advisability of investing in, purchasing, or selling securities, or who, for compensation and as part of a regular business, issues or promulgates analyses or reports concerning securities."

Source:

https://www.govinfo.gov/content/pkg/COMPS-1878/pdf/COMPS-1878.pdf

The Three-Prong Test (SEC Release IA-1092)

The SEC formally articulated the three-prong test in Investment Advisers Act Release No. 1092 (October 8, 1987). All three prongs must be met for the definition to apply:

Prong 1 — Advice on Securities: The person provides "advice about securities." This includes advice about the advisability of investing in, purchasing, or selling specific securities. It also includes issuing "analyses or reports concerning securities."

Prong 2 — In the Business: The person is "in the business" of providing that advice. IA-1092 states: "The giving of advice need not constitute the principal business activity or any particular portion of the business activities in order for a person to be an investment adviser." It "need only be done on such a basis that it constitutes a business activity occurring with some regularity."

Prong 3 — Compensation: The person receives compensation. The SEC has construed "compensation" broadly: "any economic benefit, whether in the form of an advisory fee, some other fee relating to the total services rendered, a commission, or some combination." A subscription fee paid by users satisfies this prong even if labeled as a SaaS product fee rather than an advisory fee.

Source:

https://scholarlycommons.law.wlu.edu/cgi/viewcontent.cgi?article=2389&context=wlulr
https://www.compliancebuilding.com/2011/03/28/are-you-an-investment-adviser/

Raxx's Three-Prong Analysis (Staging for Attorney)

The following is a factual staging for the attorney — not a legal conclusion:

Critical question for attorney: Is retrospective, user-data-only, rule-enforcement analysis advice "as to the value of securities or as to the advisability of investing" — or is it categorically different because it does not advise on any future action with respect to any security?

3. Publisher's Exclusion — §202(a)(11)(D)

Statutory Exclusion

Section 202(a)(11)(D) excludes from the "investment adviser" definition:

"the publisher of any bona fide newspaper, news magazine or business or financial publication of general and regular circulation"

The Supreme Court addressed this exclusion in Lowe v. SEC, 472 U.S. 181 (1985), holding that a publisher of impersonal financial newsletters was not an investment adviser under the Act.

Source:

https://supreme.justia.com/cases/federal/us/472/181/

Three Criteria for Publisher's Exclusion

SEC staff and courts have interpreted the exclusion to require:

1. Bona fide publication: Genuine commentary and analysis, not a vehicle for promotional material or personalized guidance disguised as a publication.
2. Impersonal advice: Advice must not be "adapted to the specific investment needs of individual subscribers." General analysis for the public — not tailored to a specific user's portfolio.
3. Regular circulation: Consistent, scheduled publication not timed to specific market events or individual buy/sell prompts.

Source:

https://natlawreview.com/article/navigating-publishers-exclusion-under-advisers-act
https://www.winsteadinvestmentmanagement.com/2025/12/navigating-the-publishers-exclusion-under-the-advisers-act/

Applicability to Raxx

The publisher's exclusion in its classic form (newsletter, magazine) does not map cleanly to a SaaS platform with user accounts and per-user data. The key tension:

• In favor of exclusion: Raxx does not tailor securities recommendations to any individual. It reflects the user's own pre-set rules back at the user.
• Against exclusion: A SaaS platform with user accounts and personalized dashboards is not a "publication of general and regular circulation" in any traditional sense. SEC staff has cautioned that modern software products face "the same regulatory scrutiny as traditional publishers regarding the boundary between general commentary and personalized advisory services."

Question for attorney: Is the publisher's exclusion available to a SaaS platform that processes each user's own trade data? Or is this the wrong frame — because Raxx may simply not meet Prong 1 in the first place?

4. Analytics Tool / Calculator No-Action Letter Precedents

SEC Staff No-Action Letter Framework

The SEC has issued a series of no-action letters indicating that certain investment "calculators" and information tools do not require IA registration when: 1. The information involved is readily available to the public in its raw state 2. The categories of information are not highly selective 3. The information is not organized or presented in a manner that suggests the purchase, holding, or sale of any security

Source:

https://terms.law/Trading-Legal/guides/sec-no-action-letters.html
https://www.sec.gov/divisions/investment/noaction/1996/smithr050296.pdf

Relevance to Raxx

Raxx processes the user's own trade data — not publicly available securities data — and presents it in the context of the user's own rules. The "not organized to suggest purchase/holding/sale" criterion is arguably met (Raxx reflects what the user already did, not what to do next). However:

• The existing no-action letters date primarily to the 1990s and were not written for interactive SaaS platforms.
• The SEC's 2022 request for comment on information providers (Release No. IA-6034) signaled that the agency may modernize its approach to analytics platforms, though it did not specifically address retrospective user-data tools.
• The SEC has confirmed robo-advisers require IA registration even when automated — distinguishing factor for Raxx is absence of forward-looking recommendations.

Question for attorney: Are any current no-action letters or SEC staff guidance documents on point for a SaaS platform that analyzes user-owned trading data retrospectively against user-defined rules, with no forward-looking output?

Source:

https://www.sidley.com/en/insights/newsupdates/2022/06/sec-requests-comment-on-regulation-of-information-providers-under-the-us-investment-advisers-act

5. Questions for the Securities Attorney

Listed in priority order. Bring these to the first engagement.

Threshold / Registration Questions

Q1. Under §202(a)(11) and the three-prong test articulated in SEC Release IA-1092, does Raxx's product — retrospective analysis of a user's own trade history against that user's own pre-defined rules, with no forward-looking recommendations, no autonomous execution, and no advice on the value or advisability of any security — constitute "advising others as to the value of securities or as to the advisability of investing in, purchasing, or selling securities"? Is there a principled argument that Prong 1 is simply not met?

Q2. If Prong 1 is arguable, is the publisher's exclusion under §202(a)(11)(D) and Lowe v. SEC available to a SaaS subscription platform? If not, is there another categorical exclusion, no-action letter, or safe-harbor framework that applies?

Q3. Are there SEC no-action letters, staff guidance, or enforcement decisions specifically addressing trading-journal or trade-structure-audit software that the attorney is aware of beyond the 1990s calculator letters?

Q4. The SEC's 2022 Release No. IA-6034 requested comment on information providers. Did any final rulemaking or staff guidance emerge from that process that applies here?

Q5. If the conclusion is that Raxx's current product does NOT trigger §202(a)(11), what product feature additions would cross the line — and what guardrails should be built into the product roadmap now to stay on the safe side of that line?

Marketing Copy Clearance

The attorney should review and flag the specific copy claims below. The operator needs a green/yellow/red assessment on each:

Q6. Review and flag each of the following marketing copy concepts:

Q7. What standard-form securities disclaimers should appear in the ToS and on marketing pages? The privacy/ToS attorney (engagement: #3149) needs the approved language. Specifically: what precise language distinguishes "here is what your data shows you did" from "here is our advice on what to do"?

Q8. Is there any risk that Raxx's "Founders" cohort language (early-cohort pricing, implied future appreciation of access) triggers any securities-offering framing? (Operator's belief is no — it is a subscription pricing tier, not an investment.)

State-Level (Pennsylvania) Analysis

Q9. Pennsylvania Securities Act of 1972 (70 P.S. §1-102) defines "investment adviser" using language materially similar to the federal §202(a)(11). The PA Department of Banking and Securities (DOBS) regulates state-registered IAs. If federal analysis concludes Raxx is not an IA, does the state analysis follow, or does PA DOBS apply a different standard?

Source:

https://www.legis.state.pa.us/WU01/LI/LI/US/HTM/1972/0/0284..HTM
https://www.pa.gov/agencies/dobs/securities/securities-registration-office
https://www.nasaa.org/industry-resources/investment-advisers/state-investment-adviser-registration-information/pennsylvania/

Q10. If PA-level IA registration were somehow required (and the operator does not register), what is the enforcement exposure? Cease-and-desist? Civil penalty? Criminal referral? The operator needs to understand the downside to calibrate urgency.

Q11. Does MooseQuest LLC's status as a PA-resident entity change any analysis versus a DE/WY-formed entity operating in PA?

Other Securities Considerations

Q12. The product connects to users' brokerage accounts via user-initiated OAuth (user provides their own credentials). Does acting as an intermediary in this OAuth flow — even transiently — create any broker-dealer adjacent obligations? (Operator believes no; attorney should confirm.)

Q13. Is there any FINRA membership consideration if Raxx later introduces features that let users execute trades through the Raxx interface (even via an embedded broker)? The operator should understand where that line is before the product roadmap reaches it.

Q14. Raxx's product description emphasizes "user's own data" and "user's own rules." Should this be reinforced in the ToS with explicit language stating the user acknowledges Raxx is not providing investment advice and is only reflecting the user's own pre-set parameters back to them?

6. Cited Statutes and Regulatory Sources

15 U.S.C. §80b-2(a)(11) — Investment Advisers Act of 1940, §202(a)(11) — statutory definition
https://www.govinfo.gov/content/pkg/COMPS-1878/pdf/COMPS-1878.pdf

SEC Release No. IA-1092 (October 8, 1987) — Three-prong test for investment adviser status
https://scholarlycommons.law.wlu.edu/cgi/viewcontent.cgi?article=2389&context=wlulr

Lowe v. SEC, 472 U.S. 181 (1985) — Publisher's exclusion; Supreme Court interpretation
https://supreme.justia.com/cases/federal/us/472/181/

SEC Release No. IA-6034 (June 2022) — SEC request for comment on information providers
https://www.sidley.com/en/insights/newsupdates/2022/06/sec-requests-comment-on-regulation-of-information-providers-under-the-us-investment-advisers-act

SEC Staff No-Action Letters — calculator / information tool guidance
https://terms.law/Trading-Legal/guides/sec-no-action-letters.html
https://www.sec.gov/divisions/investment/noaction/1996/smithr050296.pdf

Pennsylvania Securities Act of 1972, 70 P.S. §1-102 — PA investment adviser definition
https://www.legis.state.pa.us/WU01/LI/LI/US/HTM/1972/0/0284..HTM

Pennsylvania Department of Banking and Securities — IA Registration (Form ADV / IARD)
https://www.pa.gov/agencies/dobs/securities/securities-registration-office
https://www.nasaa.org/industry-resources/investment-advisers/state-investment-adviser-registration-information/pennsylvania/

PA Investment Adviser Registration Packet (February 2026)
https://www.pa.gov/content/dam/copapwp-pagov/en/dobs/documents/securities/forms/securities-ia%20registration%20packet.pdf

NASAA — National Association of Securities Administrators (state coordination)
https://www.nasaa.org/industry-resources/investment-advisers/state-investment-adviser-registration-information/pennsylvania/

Wilson Sonsini — Information vs. Advice: SEC Regulation of Information Providers
https://www.wsgr.com/en/insights/informationor-advice-sec-regulation-of-information-providers-may-expand-to-include-providers-of-innovative-investment-analytics.html

National Law Review — Navigating the Publisher's Exclusion Under the Advisers Act
https://natlawreview.com/article/navigating-publishers-exclusion-under-advisers-act

Winstead PC / JDSupra — Publisher's Exclusion Under the Advisers Act (December 2025)
https://www.winsteadinvestmentmanagement.com/2025/12/navigating-the-publishers-exclusion-under-the-advisers-act/

7. Timing

No statutory deadline for this analysis — but: - Raxx is publishing marketing copy now. Any copy that crosses the "investment adviser" line creates exposure from the date of first publication. - The ToS being drafted under issue #3149 must contain accurate securities disclaimers; those disclaimers should be reviewed and approved by the securities attorney BEFORE the privacy/ToS attorney finalizes them. - Recommended sequencing: Securities attorney engagement first (or concurrent), with approved disclaimer language flowing into the ToS drafting process.

Before acting on any item in this document, consult a securities attorney licensed in Pennsylvania and familiar with the Investment Advisers Act of 1940, SEC enforcement practice, and state securities law under NASAA/PA DOBS jurisdiction.

Human-to-human deliverable: this document should also be saved to the operator's Google Drive legal folder for easy retrieval at attorney meetings.