Series 63 practice questionmediumState Enforcement of Antifraud Provisions
Under the USA and NSMIA, which authority does a state Administrator retain over federal covered securities?
- AAuthority to impose merit review
- BAuthority to enforce antifraud provisions✓ Correct answer
- CAuthority to deny registration based on insufficient financials
- DAuthority to require state registration of the federal covered security itself
Explanation
Why B — Authority to enforce antifraud provisions
States retain antifraud enforcement authority over federal covered securities. They may separately require registration of broker-dealers and agents, but they may not require registration or merit review of the federal covered security itself.
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