§ 5408. Termination of employment or association of agent and investment adviser representative
and transfer of employment or association
(a) If an agent registered under this chapter terminates employment by or association
with a broker-dealer or issuer, or if an investment adviser representative registered
under this chapter terminates employment by or association with an investment adviser
or federal covered investment adviser, or if either registrant terminates activities
that require registration as an agent or investment adviser representative, the broker-dealer,
issuer, investment adviser, or federal covered investment adviser shall promptly file
a notice of termination. If the registrant learns that the broker-dealer, issuer,
investment adviser, or federal covered investment adviser has not filed the notice,
the registrant may do so.
(b) If an agent registered under this chapter terminates employment by or association
with a broker-dealer registered under this chapter and begins employment by or association
with another broker-dealer registered under this chapter; or if an investment adviser
representative registered under this chapter terminates employment by or association
with an investment adviser registered under this chapter or a federal covered investment
adviser that has filed a notice under section 5405 of this title and begins employment by or association with another investment adviser registered
under this chapter or a federal covered investment adviser that has filed a notice
under section 5405 of this title; then upon the filing by or on behalf of the registrant, within 30 days after the
termination, of an application for registration that complies with the requirement
of subsection 5406(a) of this title and payment of the filing fee required under section 5410 of this title, the registration of the agent or investment adviser representative is:
(1) immediately effective as of the date of the completed filing, if the agent’s Central
Registration Depository record or successor record or the investment adviser representative’s
Central Registration Depository record or successor record does not contain a new
or amended disciplinary disclosure within the previous 12 months; or
(2) temporarily effective as of the date of the completed filing, if the agent’s Central
Registration Depository record or successor record or the investment adviser representative’s
Central Registration Depository record or successor record contains a new or amended
disciplinary disclosure within the preceding 12 months.
(c) The Commissioner may withdraw a temporary registration if there are or were grounds
for discipline as specified in section 5412 of this title and the Commissioner does so within 30 days after the filing of the application.
If the Commissioner does not withdraw the temporary registration within the 30-day
period, registration becomes automatically effective on the 31st day after filing.
(d) The Commissioner may prevent the effectiveness of a transfer of an agent or investment
adviser representative under subdivision (b)(1) or (2) of this section based on the
public interest and the protection of investors.
(e) If the Commissioner determines that a registrant or applicant for registration is
no longer in existence or has ceased to act as a broker-dealer, agent, investment
adviser, or investment adviser representative, or is the subject of an adjudication
of incapacity or is subject to the control of a committee, conservator, or guardian,
or cannot reasonably be located, a rule adopted or order issued under this chapter
may require that the registration be canceled or terminated or the application denied.
The Commissioner may reinstate a canceled or terminated registration, with or without
hearing, and may make the registration retroactive. (Added 2005, No. 11, § 1, eff. July 1, 2006; amended 2007, No. 49, § 22.)