A customer complaint can put your registration, your money, and your freedom at risk through administrative actions, civil remedies, and criminal penalties. Each consequence follows a different legal route, with different decision makers and deadlines.
You need to know who can investigate your conduct and who can impose a remedy. The Administrator is the state official or agency responsible for securities registration, investigations, and investor protection. Registration gives a firm or representative permission to conduct specified securities business.
The Uniform Securities Act (USA) rules on Administrator authority, administrative actions, penalties, and liabilities are tested using the 1956 model, as amended by the North American Securities Administrators Association (NASAA). A model supplies language for state adoption. Apply the tested model's provisions here, rather than substituting another state's penalty figures.
Under §412, the Administrator may make, amend, and rescind rules, forms, and orders consistent with the Act. Rules supply general requirements; forms collect information; orders direct particular persons. The Administrator may classify securities and persons, prescribe different requirements for classes, and adopt registration exemptions.
Common mistakes
- Using public interest alone. A §204 disciplinary order also needs a statutory ground; an Administrator's general concern is insufficient.
- Switching the administrative clocks. Known facts at securities-registration effectiveness trigger 30 days under §306; a previously disclosed final order triggers 90 days under §204.
- Treating every order alike. A 15-day hearing-setting requirement after a summary order does not replace the 60-day deadline for judicial review of a final order.
Bottom line
- §204 discipline requires public interest and a statutory ground.
- Summary proceedings use a 15-day hearing-setting requirement after receipt of a written request.
- Withdrawal normally takes 30 days, with a one-year period for specified post-withdrawal proceedings.
- Judicial review of a final order requires filing within 60 days and creates no automatic stay.
Exam shortcut
Identify the target first: your registration, a security's registration, prohibited conduct, or customer recovery. That choice identifies the governing remedy. Attach every deadline to its triggering event. Circle "written request," "entry," "receipt," "effective," or "discovery" before selecting a number. For civil money questions, mark ownership before calculating. Then label each interest amount by its starting date. For rescission-offer questions, underline both "before suit" and the buyer's ownership status.
The full lesson (about 4,183 words, 28 min read) adds 2 worked examples, all 6 common mistakes, a self-check, free in the app.
Learning objectives
- D24
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