Question of the Week

Under the Uniform Securities Law, broker-dealers are required to sign a consent to service of process. Filing such a consent means that:

a) The individual may not be required to give self-incriminating testimony in the event of a proceeding.
b) The Administrator is permitted to assess fines or other penalties in the event of a violation of the Act.
c) The Administrator is empowered to receive suits on behalf of the individual.
d) The individual is under the jurisdiction of the Administrator for up to a year after registration is withdrawn.


Answer:

The correct answer is c.

The consent to service of process appoints the Administrator as attorney in the event of any lawsuits that may be filed. This ensures that the individual cannot be sued for a securities related violation without the Administrator knowing about it. Once the Administrator receives such a suit, the individual is promptly notified of the suit.


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