NASAA Series 63Regulation of Broker-Dealers and AgentsHard
An agent is registered with Broker-Dealer Alpha in State M. The agent wants to also register concurrently with Broker-Dealer Beta in State M. Under the Uniform Securities Act, what must happen for this dual registration to be permissible?
- ABoth Broker-Dealer Alpha and Broker-Dealer Beta must authorize the dual registration.
- BDual registration is generally prohibited under the Uniform Securities Act.
- CThe agent must obtain written consent from the Administrator only.
- DBoth Broker-Dealer Alpha and Broker-Dealer Beta must authorize the dual registration, and the Administrator must approve it.
Show answer & explanationAnswer & explanation
Correct answer: D. Both Broker-Dealer Alpha and Broker-Dealer Beta must authorize the dual registration, and the Administrator must approve it.
While dual registration is generally prohibited for agents with multiple broker-dealers, it may be permitted if both broker-dealers authorize it and the Administrator approves it. This ensures proper supervision and avoids conflicts of interest.
Why the other options are wrong
- A. Authorization from both firms is necessary, but Administrator approval is also required.
- B. It is generally prohibited, but specific conditions can allow it, making a blanket prohibition incorrect.
- C. Administrator approval is necessary, but authorization from both firms is also required.
Agent Dual Registration (USA)
An agent generally cannot be registered with more than one broker-dealer simultaneously unless both firms authorize it and the state Administrator approves the arrangement.
- General prohibition against dual registration.
- Exception requires authorization from both BDs.
- Exception also requires Administrator approval.
- Ensures supervision and manages conflicts.
Memory trick: Two firms and the Administrator must all agree for an agent to be a 'dual player'.