Remedies and Administrative Procedures - Administrator Authority

Investigate
At any time, the Administrator can conduct public or private investigations, within or outside of a state, which the Administrator considers necessary or appropriate to determine whether a person has violated, is violating, or is about to violate a rule, or to aid in the enforcement of regulations of the USA.

  • In conducting an investigation, the Administrator can at any time require (or permit) a person to testify, file a statement, or produce a record regarding facts or circumstances of a situation.

  • The Administrator can also publish a record that is of direct concern to an action, proceeding, or investigation.

In general, the Administrator has the ability to inspect records within (and outside of) his or her state. The Administrator can also require those being investigated to provide written statements under oath.

  • Issue Subpoenas
    At any time, the Administrator may issue a subpoena for investigation-related information, if he or she has jurisdiction over the transaction or security in question.

  • Other Provisions
    In addition to those already listed, the Administrator has the following powers:
    • To cooperate in SEC investigations
    • To publish information concerning a violation
    • To compel testimony regarding a violation, even if such testimony might incriminate the individual

Jurisdiction
Jurisdiction comes down to where a securities transaction was made and whether a state Administrator has the authority to regulate the activity.

  • Jurisdiction includes any offer, or offer to sell that:
    • originates or takes place in the state.
    • is directed to the state and received "at the place which it is directed".
    • is accepted in a state:
      • if the offeree reasonably believes the offeror to be present in the state.
      • and has not been previously communicated to the offeror outside the state.

  • Jurisdiction as applied to publications or radio
    An Administrator does not have jurisdiction over the following:
    • a publication that is a bona fide newspaper or other print media - if the publication has two-thirds of its circulation outside of the state in which it is published, or is circulated outside of the publication state.
    • a television or radio broadcast that is syndicated from outside the state.
    • any electronic communication originating from outside the state.
    • any electronic communication that comes from within the state, but is not intended for distribution within the state.

  • Jurisdiction as applied to investment advice and misrepresentation
    The Administrator has jurisdiction if an individual/entity attempts to commit fraud in the Administrator's state, whether or not the individual/entity in question is in the state or not.

  • Jurisdiction as applied to securities
    When it comes to exempt securities transactions, the Administrator is permitted to deny or revoke any specific transaction or security exemption, but cannot enter the order to do so unless prior notice is given to all parties, an opportunity is given for a hearing, and written findings are provided. If the Administrator issues a summary order to deny or revoke pending final determination, he or she must notify all interested parties of the reasons for entering the order and inform them that a hearing will be granted within 15 days of a written request.


Exam Tips and Tricks
An Administrator generally has jurisdiction if a transaction is originated or accepted in his/her state, or if it is directed to the state.

Administrative Actions
Related Articles
  1. Investing Basics

    Brokers and RIAs: One and the Same?

    Brokers and registered investment advisors have some key differences. Here's what you need to know.
  2. Professionals

    Understanding Series 6

    Upon successful completion of the Series 6, an individual will have the qualifications needed to sell open end mutual funds and variable annuities
  3. Professionals

    Top Strategies on How to Become a Stock Broker

    Gunning to be a stock broker and want an edge? Here's some veteran advice.
  4. Trading Systems & Software

    Steps to Starting Up an Independent Broker Dealer

    Launching your own broker-dealer is a lot of work, but the potential payoff is great, both personally and financially.
  5. Professionals

    Understanding Series 63

    Series 63 is a securities license that entitles the holder to sell securities in a particular state.
  6. Professionals

    How To Answer Option Questions On The Series 7 Exam

    Learn how to answer option questions on the Series 7 exam. Pass your Series 7 exam with the help of these tips.
  7. Insurance

    Municipal Bond Tips For The Series 7 Exam

    Learn to distinguish between general obligation and revenue bonds to ace this test.
  8. Retirement

    6 Proven Tips For Series 6 Success

    These techniques can help you pass this test without the added stress.
  9. Insurance

    Tips For Passing The Series 6 Exam

    Find out what you can do during the test to make sure you get a passing score.
  10. Professionals

    Banker Or Broker: Which Career Is Right For You?

    Bankers and stock brokers may share similar traits, but there are many differences between the two professions.
RELATED TERMS
  1. Series 6

    A securities license entitling the holder to register as a limited ...
  2. Series 79

    A examination to ensure a candidate is qualified to become a ...
  3. Research Analyst

    A person who prepares investigative reports on equity securities. ...
  4. Series 34

    An exam required for individuals seeking to engage in off-exchange ...
  5. Financial Advisor

    One who provides financial advice or guidance to customers for ...
  6. Series 23

    An exam offered by the Financial Industry Regulatory Authority ...
RELATED FAQS
  1. If I have only a limited amount of time to study for the Series 6, what should I ...

    The Series 6 Investment Company and Variable Contracts Products Representative Qualification Examination is administered ... Read Full Answer >>
  2. What role does the 'chip cycle' play in the electronics sector?

    There are several highly acclaimed private Series 6 Exam courses in the United States. Many can be completed online. Popular ... Read Full Answer >>
  3. What does passing the Series 6 enable me to do?

    The Series 6, or the Investment Company Products/Variable Contracts Limited Representative, exam is administered by the Financial ... Read Full Answer >>
  4. What are the differences between the Series 6 exam and the Series 7 exam?

    The Financial Industry Regulatory Authority (FINRA) offers a variety of licenses that must be obtained before conducting ... Read Full Answer >>
  5. Do I have to successfully complete the Series 7 exam before I can register for the ...

    There are no prerequisites to register for the Series 63 exam. However, once you have registered for the exam, you must schedule ... Read Full Answer >>
  6. I completed the Series 6, do I have to complete the entire Series 7?

    After having written the Series 6 examination, there would be significant overlap with the Series 7 in areas such as mutual ... Read Full Answer >>
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!