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Series 63 practice questionmediumAdministrator Powers — Grounds for Denial

On a timed state-securities quiz, the scenario below appears. Treat the facts as a straight Series 63 application question. A broker-dealer applicant was convicted of a securities-related misdemeanor 8 years ago. Under the Uniform Securities Act, which of the following is TRUE regarding the Administrator's ability to deny registration?

  1. AThe Administrator cannot deny registration because the conviction is more than 5 years old
  2. BThe Administrator can deny registration only if the conviction was a felony
  3. CThe Administrator must grant registration but may impose additional supervision requirements
  4. DThe Administrator may deny registration because a securities-related misdemeanor conviction within the past 10 years is grounds for denial✓ Correct answer
Explanation

Why D — The Administrator may deny registration because a securities-related misdemeanor conviction within the past 10 years is grounds for denial

Under USA Section 204(a)(2), the Administrator may deny registration if the applicant has been convicted of any securities-related misdemeanor within the past 10 years, or any felony within the past 10 years. The 10-year lookback period applies to both felonies and securities-related misdemeanors. The governing USA principle is unchanged even though the framing is different.

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