Hundreds of delinquent medium-sized RIAs must register with their respective states by today’s SEC deadline or face the prospect of being de-registered as early as Sept. 1.

That’s according to an SEC official who declined to be identified but said the first notices of de-registration could go out in August to RIAs, with $25 million to $90 million in assets, who have not yet registered with their states.

“We will be coordinating with the states to decide the best actions for each advisor,” the official said. Notices will inform tardy recipients that they have 20 to 30 days to address the SEC’s concerns. “You’ve been put on notice that we will cancel your registration unless you fix it,” the official said.

As required by Dodd-Frank, states will begin to regulate RIAs with $25 million to $90 million in AUM, starting this year. Next year that number increases to $100 million.

Right now, the commission has set its sights on three classes of delinquent advisors, according to the SEC official. The first group has already filed their state application, but late enough that they are still being processed. Advisors in the second group have not yet filed with their states, but did comply with their annual requirement to file their Form ADV with the SEC earlier this year. Advisors in the third group have neither filed their ADVs, nor their state registration applications, the official said.

“They (in group three) really don’t have much excuse in my opinion,” the SEC official said. Advisors in groups two and three run the greatest risk of de-registration. Those in group one need to promptly address deficiencies in their applications as noted by their respective states in order to complete the process.

In April, the SEC sent courtesy email reminders to hundreds of advisors, who had not yet begun the process. A second courtesy email went out two weeks ago, the official said.

Firms that are de-registered by the SEC and not yet registered with their states will not be permitted to collect fees from clients. Any fees collected during a period of de-registration must be returned.

“If you are not registered as an investment advisor,” the SEC official said, “then you cannot be conducting business as an investment advisor.”

There’s no way to predict how many RIAs ultimately may become de-registered, according to the official. A certain number probably have already gone out of business but failed to formally withdraw their registrations.

But others simply have their heads in the sand, according to compliance consultant Cindi Hill of Hill Compliance Advisors in San Diego, Calif.

“Most of those advisors probably received [messages from the SEC] in ten different ways that should be causing them to look at this,” Hill says. “The ones that aren’t looking are the ones that procrastinate on everything.”