Series 63 practice questionmediumDenial Due to Insolvency
A broker-dealer applicant files for bankruptcy. Under the USA, which is the most likely outcome?
- AThe Administrator may deny the application due to insolvency.✓ Correct answer
- BRegistration must be approved if no criminal history exists.
- CThe applicant may not reapply for 10 years.
- DThe Administrator must hold a formal hearing before any action.
Explanation
Why A — The Administrator may deny the application due to insolvency.
Insolvency is valid grounds for denial under Section 204. There is no mandatory approval or 10-year bar. A summary order can be issued before a hearing is held.
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