Series 66

By Investopedia AAA

Remedies and Administrative Procedures - Additional Administrative Powers

In addition to the following items (initiated by the Administrator), a broker-dealer may withdraw its own registration at any time, and this withdrawal is effective 30 days after an initial withdrawal application is filed. Lastly, if a broker-dealer withdraws its registration, and then (within one year) the Administrator finds a wrongdoing, the Administrator may still commence disciplinary proceedings.

  • Denial
    The Administrator may deny an application if:
    • it is incomplete, contains any misleading information or omits vital facts.

    • within the last 10 years, the applicant was convicted of a securities-related misdemeanor or any felony whatsoever - regardless of whether or not it was securities related.

    • another Administrator already denied registration, or another suspension or revocation order is already in effect.

    • the Administrator finds that the applicant is not financially solvent and/or is in a state of bankruptcy.

    • a court order exists barring the registrant from working in the securities industry.

    • the Administrator deems that the registrant is not qualified for the type of business he or she intends to pursue. However, an Administrator cannot suspend registration if the registrant can give material proof that he or she is qualified.

  • Revocation
    • An Administrator may revoke registration at any time, if any one of the above six items listed under Denial is found to be true.

    • In addition, the Administrator may revoke the registration of an officer or partner of a firm without crippling the entire firm, although such action could also be grounds for revoking the registration of the firm as a larger entity.

    • Registration may be revoked from an agent without being revoked from the broker-dealer, if it is found that the broker-dealer was competently supervising the agent but was nevertheless unable to prevent the agent from committing some sort of fraudulent activity. However, if the agent's fraudulent activity was the direct result of a broker-dealer's incompetent supervision, then the broker-dealer's registration is at risk as well.

  • Suspension
    Suspension can occur for the same reasons as Denial, though registration may be reinstated pending a hearing. Hearings are usually held within 15 days of the initial request.

  • Cancellation
    • An Administrator may cancel an agent's registration if the agent is found to be deceased, or not able to perform his or her duties. In short, if for any reason the agent becomes incompetent, the Administrator may cancel registration.

    • If an agent disappears and cannot be found after a reasonable search (e.g. Jane's lounging on an exotic beach somewhere and her firm can't find her for a month), the Administrator may revoke registration.

  • Cease and Desist
    The Administrator may issue a cease and desist order, if it has determined that a particular action is in violation of the USA. If the cease and desist order is ignored, the Administrator may have a court intervene and issue an injunction against the party in question.
Other Penalties and Liabilities: Civil

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