Remedies and Administrative Procedures - Administrative Actions

The Administrator has the power to deny, revoke or suspend registrations or licenses at any time, if the Administrator feels he or she is acting for the benefit of the public. Moreover, the Administrator has an obligation to not misuse his or her powers for personal gain.

The USA gives the Administrator very broad powers and applies to offers made either verbally or in writing. The powers apply to broker-dealers, agents, investment advisors and investment advisor representatives.

The Administrator can deny, suspend, or revoke registration if it is in the public interest and if the registrant:

  • files a materially false, incomplete or misleading application.
  • willfully violates any provision of the Uniform Securities Act.
  • is prohibited by court order from engaging in the securities industry.
  • becomes insolvent.
  • fails to pay required fees.
  • is convicted of any felony, or any misdemeanor involving the securities industry.
  • engages in unethical or dishonest business practices.
  • is unqualified due to lack of experience, training or knowledge.
  • fails to properly supervise employees.

However, the Administrator cannot deny, suspend or revoke a registration solely based on a lack of experience if the applicant is otherwise qualified by training or knowledge.

Look Out!
While this list of potential reasons to deny a registration application includes the item "is unqualified due to lack of experience, training or knowledge", note that the paragraph that follows states that the Administrator cannot deny or revoke a registration based on "lack of experience if otherwise qualified by training or knowledge". You\'re likely to be tested on that distinction, so watch for answers such as "the Administrator can deny registration if it is in the public interest and an Investment Advisor (IA) has a degree in finance but no investment advisory experience". That answer would be incorrect, since the IA does have training or knowledge.

Exam Tips and Tricks
If, for any reason, an Administrator decides to take any one of the following three actions (denial, revocation or suspension), he/she must expressly detail the reasoning behind the injunctive act and give the person/entity in question a chance for appeal.

Additional Administrative Powers
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