§ 23-19-4-1 — Broker-dealer registration; exemptions; restrictions on employment or association; foreign transactions

Indiana § 23-19-4-1

• Jurisdiction: Indiana
• Title 23: BUSINESS AND OTHER ASSOCIATIONS
• Art. 19: INDIANA UNIFORM SECURITIES ACT
• Ch. 4: Broker-Dealers, Agents, Investment Advisers,

Text

(a) It is unlawful for a person to transact
business in this state as a broker-dealer unless the person is registered
under this article as a broker-dealer or is exempt from registration as
a broker-dealer under subsection (b) or (d).
(b) The following persons are exempt from the registration
requirement of subsection (a):
(1) A broker-dealer without a place of business in this state if its
only transactions effected in this state are with:
(A) the issuer of the securities involved in the transactions;
(B) a broker-dealer registered as a broker-dealer under this
article or not required to be registered as a broker-dealer under
this article;
(C) an institutional investor;
(D) a nonaffiliated federal covered investment adviser with
investments under management in excess of one hundred
million dollars ($100,000,000) acting for the account of others
under discretionary authority in a signed record;
(E) a bona fide preexisting customer whose principal place of
residence is not in this state, and the person is registered as a
broker-dealer under the Securities Exchange Act of 1934 or not
required to be registered under the Securities Exchange Act of
1934 and is registered under the securities act of the state in
which the customer maintains a principal place of residence;
(F) a bona fide preexisting customer whose principal place of
residence is in this state but who was not present in this state
when the customer relationship was established, if:
(i) the broker-dealer is registered under the Securities
Exchange Act of 1934 or not required to be registered under
the Securities Exchange Act of 1934 and is registered under
the securities laws of the state in which the customer
relationship was established and where the customer had
maintained a principal place of residence; and
(ii) within forty-five (45) days after the customer's first
transaction in this state, the person files an application for
registration as a broker-dealer in this state and a further
transaction is not effected more than seventy-five (75) days
after the date on which the application is filed, or, if earlier,
the date on which the commissioner notifies the person that
the commissioner has denied the application for registration
or has stayed the pendency of the application for good cause;
(G) not more than three (3) customers in this state during the
previous twelve (12) months, in addition to those customers
specified in clauses (A) through (F) and under clause (H), if the
broker-dealer is registered under the Securities Exchange Act
of 1934 or not required to be registered under the Securities
Exchange Act of 1934 and is registered under the securities act
of the state in which the broker-dealer has its principal place of
business; and
(H) any other person exempted by rule adopted or order issued
under this article.
(2) A person that deals solely in United States government
securities and is supervised as a dealer in government securities
by the Board of Governors of the Federal Reserve System, the
Comptroller of the Currency, the Federal Deposit Insurance
Corporation, or the Office of Thrift Supervision.
(c) It is unlawful for a broker-dealer, or for an issuer engaged in
offering, offering to purchase, purchasing, or selling securities in this
state, directly or indirectly, to employ or associate with an individual
to engage in an activity related to securities transactions in this state if
the registration of the individual is suspended or revoked or the
individual is barred from employment or association with a
broker-dealer, an issuer, an investment adviser, or a federal covered
investment adviser by an order of the commissioner under this article,
the Securities and Exchange Commission, or a self-regulatory
organization. A broker-dealer or issuer does not violate this subsection
if the broker-dealer or issuer did not know and in the exercise of
reasonable care could not have known, of the suspension, revocation,
or bar. Upon request from a broker-dealer or issuer and for good cause,
an order under this article may modify or waive, in whole or in part, the
application of the prohibitions of this subsection to the broker-dealer.
(d) A rule adopted or order issued under this article may permit:
(1) a broker-dealer that is registered in Canada or another foreign
jurisdiction and that does not have a place of business in this state
to effect transactions in securities with or for, or attempt to effect
the purchase or sale of any securities by:
(A) an individual from Canada or another foreign jurisdiction
who is temporarily present in this state and with whom the
broker-dealer had a bona fide customer relationship before the
individual entered the United States;
(B) an individual from Canada or another foreign jurisdiction
who is present in this state and whose transactions are in a
self-directed tax advantaged retirement plan of which the
individual is the holder or contributor in that foreign
jurisdiction; or
(C) an individual who is present in this state, with whom the
broker-dealer customer relationship arose while the individual
was temporarily or permanently resident in Canada or the other
foreign jurisdiction; and
(2) an agent who represents a broker-dealer that is exempt under
this subsection to effect transactions in securities or attempt to
effect the purchase or sale of securities in this state as permitted
for a broker-dealer described in subdivision (1).

Legislative History

As added by P.L.27-2007, SEC.23.