Series 63 practice questioneasyCease and desist orders
An agent in State A is suspected of selling unregistered securities. What action can the Administrator take prior to holding a hearing?
- AIssue a cease and desist order against the agent.✓ Correct answer
- BImpose criminal penalties immediately.
- CRevoke the agent’s registration immediately and permanently.
- DRequire the agent to pay restitution to investors immediately.
Explanation
Why A — Issue a cease and desist order against the agent.
The Administrator may issue a cease and desist order with or without a prior hearing (USA Sec 408). Criminal penalties and restitution require due process, and revocation is a later step after notice and opportunity for hearing.
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