Authority: IC 23-19-6-5

Affected: IC 23-19

Sec. 2. (a) Unless specifically exempt, as hereinafter provided, the broker-dealer examinations in the form and content prescribed or approved by the commissioner must be taken and passed by every principal of a broker-dealer in order to test the principal's knowledge of:

1. (1) the securities business;
2. (2) state securities laws; and
3. (3) the responsibilities of a supervisor in the securities business;

before the applicant will be considered eligible for registration.

(b) The commissioner shall establish or approve the standards for a minimum acceptable grade in determining each applicant's qualification for registration under this provision. The examination requirements for broker-dealer applicants shall be higher than those for agent applicants.

(c) Upon failure to receive a minimum passing grade the principal of the broker-dealer applicant may retake the examination on the next date available. A second failure, or failure to take or retake the examination within a thirty (30) day period from the date the broker-dealer application was filed, shall be sufficient grounds for denial of the broker-dealer application and an order to that effect may be entered by the commissioner. The broker-dealer applicant shall be considered ineligible for licensing during a period of three (3) months, at which time a new broker-dealer application may be filed and its eligibility reexamined. The original filing fee shall not be refunded nor applied to a subsequent application for registration under this provision. However, if the:

1. (1) broker-dealer applicant is qualified;
2. (2) broker-dealer applicant meets the requirements of subsection (d); and
3. (3) principal of that applicant who fails the examination qualifies for an exemption under subsection (f);

then the broker-dealer application shall not be denied.

(d) The following are the examination requirements for principals of a broker-dealer:

1. (1) In the case of:

   1. (A) a partnership;
   2. (B) a corporation; or
   3. (C) another association;

2. (2) at least two (2):

   1. (A) partners;
   2. (B) officers;
   3. (C) directors; or
   4. (D) persons occupying a similar position;
3. (3) must satisfy the examination requirement.
4. (4) However, only one (1) of those persons must satisfy the examination requirement if the broker-dealer maintains no branch offices and employs no more than ten (10) agents.

(e) An application shall be deemed incomplete until there is a showing of compliance with the examination requirements or an exemption from those requirements.

(f) The examination requirements may be waived by a proper showing or certification that the applicant:

1. (1) has:

   1. (A) taken an examination in the form and content approved by the commissioner within the preceding two (2) years; and
   2. (B) passed the examination with the minimum acceptable passing grade for broker-dealer applicants; or

2. (2) has:

   1. (A) taken an examination in the form and content prescribed or approved by the commissioner;
   2. (B) attained an acceptable passing grade; and
   3. (C) thereafter, remained continuously in the securities business, duly licensed by another state;
3. prior to making application.

(Securities Division; 710 IAC 4-7-2; filed Jun 28, 2010, 2:36 p.m.: 20100728-IR-710100044FRA; readopted filed May 12, 2016, 1:47 p.m.: 20160608-IR-710160136RFA; readopted filed Nov 30, 2022, 4:01 p.m.: 20221228-IR- 710220301RFA)