Series 63 practice questionhardAdministrator Powers — Jurisdiction
In a state-administrator case study, the scenario starts here. Treat the facts as a straight Series 63 application question. A broker-dealer incorporated in State A with its principal office in State B has a client in State C who was sold unregistered securities. Which state Administrator(s) have jurisdiction to take action?
- AOnly the Administrator of State A, where the firm is incorporated
- BOnly the Administrator of State B, where the principal office is located
- COnly the SEC, since multiple states are involved
- DAny state where the offer or sale was directed, including State C✓ Correct answer
Explanation
Why D — Any state where the offer or sale was directed, including State C
Under USA Section 401, the act applies whenever an offer to sell or buy is made or accepted in the state, or when any act constituting part of the transaction occurs in the state. State C's Administrator has jurisdiction because the sale was directed to a client in that state. The governing USA principle is unchanged even though the framing is different.
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