Indiana 2025 Regular Session

Indiana House Bill HB1545 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2	Introduced Version
3	3	HOUSE BILL No. 1545
4	4	_____
5	5	DIGEST OF INTRODUCED BILL
6	6	Citations Affected: IC 23-19-4; IC 23-19-4.3.
7	7	Synopsis: Investment adviser representatives and agents. Requires an
8	8	applicant seeking to register as an agent of a broker-dealer in Indiana
9	9	to pass financial industry regulatory authority (FINRA) examinations
10	10	unless certain exceptions apply. Requires an applicant seeking to
11	11	register as an investment adviser representative in Indiana to pass
12	12	FINRA examinations unless certain exceptions apply. Provides that
13	13	under certain circumstances an agent of a broker-dealer or an
14	14	investment adviser representative may have the validity of the
15	15	individual's FINRA qualifying examinations extended. Requires an
16	16	investment adviser representative to participate in a continuing
17	17	education program.
18	18	Effective: July 1, 2025.
19	19	Heaton
20	20	January 21, 2025, read first time and referred to Committee on Financial Institutions.
21	21	2025 IN 1545—LS 7705/DI 154 Introduced
22	22	First Regular Session of the 124th General Assembly (2025)
23	23	PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
24	24	Constitution) is being amended, the text of the existing provision will appear in this style type,
25	25	additions will appear in this style type, and deletions will appear in this style type.
26	26	Additions: Whenever a new statutory provision is being enacted (or a new constitutional
27	27	provision adopted), the text of the new provision will appear in this style type. Also, the
28	28	word NEW will appear in that style type in the introductory clause of each SECTION that adds
29	29	a new provision to the Indiana Code or the Indiana Constitution.
30	30	Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
31	31	between statutes enacted by the 2024 Regular Session of the General Assembly.
32	32	HOUSE BILL No. 1545
33	33	A BILL FOR AN ACT to amend the Indiana Code concerning
34	34	business and other associations.
35	35	Be it enacted by the General Assembly of the State of Indiana:
36	36	1 SECTION 1. IC 23-19-4-6, AS AMENDED BY P.L.114-2010,
37	37	2 SECTION 9, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
38	38	3 JULY 1, 2025]: Sec. 6. (a) A person shall register as a broker-dealer,
39	39	4 agent, investment adviser, or investment adviser representative by
40	40	5 filing an application and a consent to service of process complying with
41	41	6 IC 23-19-6-11, satisfying the examination requirements of
42	42	7 IC 23-19-4.3, and paying the fee specified in section 10 of this chapter
43	43	8 and any reasonable fees charged by the designee of the commissioner
44	44	9 for processing the filing. The application must contain:
45	45	10 (1) the information or record required for the filing of a uniform
46	46	11 application; and
47	47	12 (2) upon request by the commissioner, any other financial or other
48	48	13 information or record that the commissioner determines is
49	49	14 appropriate.
50	50	15 (b) If the information or record contained in an application filed
51	51	16 under subsection (a) is or becomes inaccurate or incomplete in a
52	52	17 material respect, the registrant shall promptly file a correcting
53	53	2025 IN 1545—LS 7705/DI 154 2
54	54	1 amendment.
55	55	2 (c) At the time of application for an initial registration as an
56	56	3 investment adviser representative under this article, the commissioner
57	57	4 shall require each applicant to submit fingerprints for a national
58	58	5 criminal history background check (as defined in IC 10-13-3-12) by the
59	59	6 Federal Bureau of Investigation, for use by the commissioner in
60	60	7 determining whether the applicant should be denied registration under
61	61	8 this chapter for any reason set forth in section 12(d) of this chapter. The
62	62	9 applicant shall pay any fees or costs associated with the fingerprints
63	63	10 and background check required under this subsection.
64	64	11 (d) If an order is not in effect and a proceeding is not pending under
65	65	12 section 12 of this chapter, registration becomes effective at noon on the
66	66	13 forty-fifth day after a completed application is filed, unless the
67	67	14 registration is denied. A rule adopted or order issued under this article
68	68	15 may set an earlier effective date or may defer the effective date until
69	69	16 noon on the forty-fifth day after the filing of any amendment
70	70	17 completing the application.
71	71	18 (e) A registration is effective until midnight on December 31 of the
72	72	19 year for which the application for registration is filed. Unless an order
73	73	20 is in effect under section 12 of this chapter, a registration may be
74	74	21 automatically renewed each year by filing such records as are required
75	75	22 by rule adopted or order issued under this article, by paying the fee
76	76	23 specified in section 10 of this chapter, and by paying costs charged by
77	77	24 the designee of the commissioner for processing the filings.
78	78	25 (f) A rule adopted or order issued under this article may impose
79	79	26 other conditions, not inconsistent with the National Securities Markets
80	80	27 Improvement Act of 1996. An order issued under this article may
81	81	28 waive, in whole or in part, specific requirements in connection with
82	82	29 registration as are in the public interest and for the protection of
83	83	30 investors.
84	84	31 SECTION 2. IC 23-19-4-11, AS AMENDED BY P.L.1-2010,
85	85	32 SECTION 94, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
86	86	33 JULY 1, 2025]: Sec. 11. (a) Subject to Section 15(h) of the Securities
87	87	34 Exchange Act of 1934 (15 U.S.C. 78o(h)) or Section 222 of the
88	88	35 Investment Advisers Act of 1940 (15 U.S.C. 80b-18a), a rule adopted
89	89	36 or order issued under this article may establish minimum financial
90	90	37 requirements for broker-dealers registered or required to be registered
91	91	38 under this article and investment advisers registered or required to be
92	92	39 registered under this article.
93	93	40 (b) Subject to Section 15(h) of the Securities Exchange Act of 1934
94	94	41 (15 U.S.C. 78o(h)) or Section 222(b) of the Investment Advisers Act
95	95	42 of 1940 (15 U.S.C. 80b-18a(b)), a broker-dealer registered or required
96	96	2025 IN 1545—LS 7705/DI 154 3
97	97	1 to be registered under this article and an investment adviser registered
98	98	2 or required to be registered under this article shall file such financial
99	99	3 reports as are required by a rule adopted or order issued under this
100	100	4 article. If the information contained in a record filed under this
101	101	5 subsection is or becomes inaccurate or incomplete in a material
102	102	6 respect, the registrant shall promptly file a correcting amendment.
103	103	7 (c) Subject to Section 15(h) of the Securities Exchange Act of 1934
104	104	8 (15 U.S.C. 78o(h)) or Section 222 of the Investment Advisers Act of
105	105	9 1940 (15 U.S.C. 80b-18a):
106	106	10 (1) a broker-dealer registered or required to be registered under
107	107	11 this article and an investment adviser registered or required to be
108	108	12 registered under this article shall make and maintain the accounts,
109	109	13 correspondence, memoranda, papers, books, and other records
110	110	14 required by rule adopted or order issued under this article;
111	111	15 (2) broker-dealer records required to be maintained under
112	112	16 subdivision (1) may be maintained in any form of data storage
113	113	17 acceptable under Section 17(a) of the Securities Exchange Act of
114	114	18 1934 (15 U.S.C. 78q(a)) if they are readily accessible to the
115	115	19 commissioner; and
116	116	20 (3) investment adviser records required to be maintained under
117	117	21 subdivision (1) may be maintained in any form of data storage
118	118	22 required by rule adopted or order issued under this article.
119	119	23 (d) The records of a broker-dealer registered or required to be
120	120	24 registered under this article and of an investment adviser registered or
121	121	25 required to be registered under this article are subject to such
122	122	26 reasonable periodic, special, or other audits or inspections by a
123	123	27 representative of the commissioner, within or outside this state, as the
124	124	28 commissioner considers necessary or appropriate in the public interest
125	125	29 and for the protection of investors. An audit or inspection may be made
126	126	30 at any time and without prior notice. The commissioner may copy, and
127	127	31 remove for audit or inspection copies of, all records the commissioner
128	128	32 reasonably considers necessary or appropriate to conduct the audit or
129	129	33 inspection. The commissioner may assess a reasonable charge for
130	130	34 conducting an audit or inspection under this subsection.
131	131	35 (e) Subject to Section 15(h) of the Securities Exchange Act of 1934
132	132	36 (15 U.S.C. 78o(h)) or Section 222 of the Investment Advisers Act of
133	133	37 1940 (15 U.S.C. 80b-18a), a rule adopted or order issued under this
134	134	38 article may require a broker-dealer or investment adviser that has
135	135	39 custody of or discretionary authority over funds or securities of a
136	136	40 customer or client to obtain insurance or post a bond or other
137	137	41 satisfactory form of security in an amount not to exceed fifty thousand
138	138	42 dollars ($50,000). The commissioner may determine the requirements
139	139	2025 IN 1545—LS 7705/DI 154 4
140	140	1 of the insurance, bond, or other satisfactory form of security. Insurance
141	141	2 or a bond or other satisfactory form of security may not be required of
142	142	3 a broker-dealer registered under this article whose net capital exceeds,
143	143	4 or of an investment adviser registered under this article whose
144	144	5 minimum financial requirements exceed, the amounts required by rule
145	145	6 or order under this article. The insurance, bond, or other satisfactory
146	146	7 form of security must permit an action by a person to enforce any
147	147	8 liability on the insurance, bond, or other satisfactory form of security
148	148	9 if instituted within the time limitations in IC 23-19-5-9(g).
149	149	10 (f) Subject to Section 15(h) of the Securities Exchange Act of 1934
150	150	11 (15 U.S.C. 78o(h)) or Section 222 of the Investment Advisers Act of
151	151	12 1940 (15 U.S.C. 80b-18a), an agent may not have custody of funds or
152	152	13 securities of a customer except under the supervision of a broker-dealer
153	153	14 and an investment adviser representative may not have custody of
154	154	15 funds or securities of a client except under the supervision of an
155	155	16 investment adviser or a federal covered investment adviser. A rule
156	156	17 adopted or order issued under this article may prohibit, limit, or impose
157	157	18 conditions on a broker-dealer regarding custody of funds or securities
158	158	19 of a customer and on an investment adviser regarding custody of
159	159	20 securities or funds of a client.
160	160	21 (g) With respect to an investment adviser registered or required to
161	161	22 be registered under this article, a rule adopted or order issued under
162	162	23 this article may require that information or other records be furnished
163	163	24 or disseminated to clients or prospective clients in this state as
164	164	25 necessary or appropriate in the public interest and for the protection of
165	165	26 investors and advisory clients.
166	166	27 (h) A rule adopted or order issued under this article may require an
167	167	28 individual registered under section 2 or 4 of this chapter to participate
168	168	29 in a continuing education program approved by the Securities and
169	169	30 Exchange Commission and administered by a self-regulatory
170	170	31 organization or, in the absence of such a program, a rule adopted or
171	171	32 order issued under this article may require continuing education for an
172	172	33 individual registered under section 4 of this chapter.
173	173	34 (i) (h) Subject to section 11.5 of this chapter, the commissioner may
174	174	35 annually select as many as twenty-five percent (25%) of all Indiana
175	175	36 home and branch offices of registered broker-dealers for completion of
176	176	37 compliance reports. Subject to section 11.5 of this chapter, each
177	177	38 broker-dealer office that is selected shall file its compliance report
178	178	39 according to rules adopted by the commissioner under this article not
179	179	40 later than forty-five (45) days after being notified of selection under
180	180	41 this subsection. No charges or other examination fees may be assessed
181	181	42 against a registered broker-dealer as a result of the examination of a
182	182	2025 IN 1545—LS 7705/DI 154 5
183	183	1 compliance report filed under this subsection unless the examination
184	184	2 results in an investigation or examination made under IC 23-19-6-2(a).
185	185	3 SECTION 3. IC 23-19-4-11.5, AS ADDED BY P.L.149-2009,
186	186	4 SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
187	187	5 JULY 1, 2025]: Sec. 11.5. (a) As used in this section, "office of
188	188	6 supervisory jurisdiction" has the meaning set forth in the National
189	189	7 Association of Securities Dealers Conduct Rule 3010(g) (as in effect
190	190	8 on January 1, 2009).
191	191	9 (b) A broker-dealer registered or required to be registered under this
192	192	10 article may not be selected for completion of a compliance report under
193	193	11 section 11(i) 11(h) of this chapter in consecutive years unless the
194	194	12 commissioner has reason to believe that the broker-dealer has
195	195	13 committed a violation of this article.
196	196	14 (c) The commissioner may not select for completion of a
197	197	15 compliance report under section 11(i) 11(h) of this chapter any office
198	198	16 that:
199	199	17 (1) reports to an office of supervisory jurisdiction located within
200	200	18 Indiana;
201	201	19 (2) reflects the address of the office of supervisory jurisdiction
202	202	20 described in subdivision (1) on all of the office's business cards,
203	203	21 stationery, advertisements, and other communications to the
204	204	22 public; and
205	205	23 (3) is included in the definition of branch office under the
206	206	24 National Association of Securities Dealers Conduct Rule 3010(g)
207	207	25 because the office:
208	208	26 (A) handles funds or securities as described under the National
209	209	27 Association of Securities Dealers Conduct Rule
210	210	28 3010(g)(2)(A)(ii)(c); or
211	211	29 (B) uses the residential address on all business cards,
212	212	30 stationery, advertisements, or other communications to the
213	213	31 public under the National Association of Securities Dealers
214	214	32 Conduct Rule 3010(g)(2)(A)(ii)(d).
215	215	33 SECTION 4. IC 23-19-4-12, AS AMENDED BY P.L.205-2021,
216	216	34 SECTION 6, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
217	217	35 JULY 1, 2025]: Sec. 12. (a) If the commissioner finds that the order is
218	218	36 in the public interest and subsection (d) authorizes the action, an order
219	219	37 issued under this article may deny an application, or may condition or
220	220	38 limit registration, of an applicant to be a broker-dealer, agent,
221	221	39 investment adviser, or investment adviser representative and, if the
222	222	40 applicant is a broker-dealer or investment adviser, of a partner, officer,
223	223	41 director, or person having a similar status or performing similar
224	224	42 functions, or a person directly or indirectly in control of the
225	225	2025 IN 1545—LS 7705/DI 154 6
226	226	1 broker-dealer or investment adviser.
227	227	2 (b) If the commissioner finds that the order is in the public interest
228	228	3 and subsection (d) authorizes the action, an order issued under this
229	229	4 article may revoke, suspend, condition, or limit the registration of a
230	230	5 registrant and, if the registrant is a broker-dealer or investment adviser,
231	231	6 of a partner, officer, director, or person having a similar status or
232	232	7 performing similar functions, or a person directly or indirectly in
233	233	8 control of the broker-dealer or investment adviser. However, the
234	234	9 commissioner may not:
235	235	10 (1) institute a revocation or suspension proceeding under this
236	236	11 subsection based on an order issued under a law of another state
237	237	12 that is reported to the commissioner or a designee of the
238	238	13 commissioner more than one (1) year after the date of the order on
239	239	14 which it is based; or
240	240	15 (2) under subsection (d)(5)(A) and (d)(5)(B), issue an order on
241	241	16 the basis of an order issued under the securities act of another
242	242	17 state unless the other order was based on conduct for which
243	243	18 subsection (d) would authorize the action had the conduct
244	244	19 occurred in this state.
245	245	20 (c) If the commissioner finds that the order is in the public interest
246	246	21 and subsection (d)(1), (d)(2), (d)(3), (d)(4), (d)(5), (d)(6), (d)(8), (d)(9),
247	247	22 (d)(11), (d)(12), or (d)(13) authorizes the action, an order under this
248	248	23 article may censure, impose a bar, or impose a civil penalty in an
249	249	24 amount not to exceed a maximum of ten thousand dollars ($10,000) per
250	250	25 violation on a registrant, and, if the registrant is a broker-dealer or
251	251	26 investment adviser, a partner, officer, director, or person having a
252	252	27 similar status or performing similar functions, or a person directly or
253	253	28 indirectly in control of the broker-dealer or investment adviser.
254	254	29 (d) A person may be disciplined under subsections (a) through (c)
255	255	30 if the person:
256	256	31 (1) has filed an application for registration in this state under this
257	257	32 article or the predecessor act within the previous ten (10) years,
258	258	33 which, as of the effective date of registration or as of any date
259	259	34 after filing in the case of an order denying effectiveness, was
260	260	35 incomplete in any material respect or contained a statement that,
261	261	36 in light of the circumstances under which it was made, was false
262	262	37 or misleading with respect to a material fact;
263	263	38 (2) knowingly violated or knowingly failed to comply with this
264	264	39 article or the predecessor act or a rule adopted or order issued
265	265	40 under this article or the predecessor act within the previous ten
266	266	41 (10) years;
267	267	42 (3) has been convicted of a felony or within the previous ten (10)
268	268	2025 IN 1545—LS 7705/DI 154 7
269	269	1 years has been convicted of a misdemeanor involving a security,
270	270	2 a commodity future or option contract, or an aspect of a business
271	271	3 involving securities, commodities, investments, franchises,
272	272	4 insurance, banking, or finance;
273	273	5 (4) is enjoined or restrained by a court with jurisdiction in an
274	274	6 action instituted by the commissioner under this article or the
275	275	7 predecessor act, a state, the Securities and Exchange Commission,
276	276	8 or the United States from engaging in or continuing an act,
277	277	9 practice, or course of business involving an aspect of a business
278	278	10 involving securities, commodities, investments, franchises,
279	279	11 insurance, banking, or finance;
280	280	12 (5) is the subject of an order, issued after notice and opportunity
281	281	13 for hearing, by:
282	282	14 (A) the securities, depository institution, insurance, or other
283	283	15 financial services regulator of a state or by the Securities and
284	284	16 Exchange Commission or other federal agency denying,
285	285	17 revoking, barring, or suspending registration as a
286	286	18 broker-dealer, agent, investment adviser, federal covered
287	287	19 investment adviser, or investment adviser representative;
288	288	20 (B) the securities regulator of a state or the Securities and
289	289	21 Exchange Commission against a broker-dealer, agent,
290	290	22 investment adviser, investment adviser representative, or
291	291	23 federal covered investment adviser;
292	292	24 (C) the Securities and Exchange Commission or a
293	293	25 self-regulatory organization suspending or expelling the
294	294	26 registrant from membership in the self-regulatory
295	295	27 organization;
296	296	28 (D) a court adjudicating a United States Postal Service fraud
297	297	29 order;
298	298	30 (E) the insurance regulator of a state denying, suspending, or
299	299	31 revoking registration as an insurance agent;
300	300	32 (F) a depository institution regulator suspending or barring the
301	301	33 person from the depository institution business; or
302	302	34 (G) any state regulatory body or organization governing real
303	303	35 estate brokers or sales persons denying, suspending, or
304	304	36 revoking a person's registration or license in the real estate
305	305	37 industry;
306	306	38 (6) is the subject of an adjudication or determination, after notice
307	307	39 and opportunity for hearing, by the Securities and Exchange
308	308	40 Commission, the Commodity Futures Trading Commission, the
309	309	41 Federal Trade Commission, a federal depository institution
310	310	42 regulator, or a depository institution, insurance, or other financial
311	311	2025 IN 1545—LS 7705/DI 154 8
312	312	1 services regulator of a state that the person willfully violated the
313	313	2 Securities Act of 1933, the Securities Exchange Act of 1934, the
314	314	3 Investment Advisers Act of 1940, the Investment Company Act
315	315	4 of 1940, or the Commodity Exchange Act, the securities or
316	316	5 commodities law of a state, or a federal or state law under which
317	317	6 a business involving investments, franchises, insurance, banking,
318	318	7 or finance is regulated;
319	319	8 (7) is insolvent, either because the person's liabilities exceed the
320	320	9 person's assets or because the person cannot meet the person's
321	321	10 obligations as they mature, but the commissioner may not enter an
322	322	11 order against an applicant or registrant under this subdivision
323	323	12 without a finding of insolvency as to the applicant or registrant;
324	324	13 (8) refuses to allow or otherwise impedes the commissioner from
325	325	14 conducting an audit or inspection under section 11(d) of this
326	326	15 chapter or refuses access to a registrant's office to conduct an
327	327	16 audit or inspection under section 11(d) of this chapter;
328	328	17 (9) has failed to reasonably supervise an agent, investment adviser
329	329	18 representative, or other individual, if the agent, investment
330	330	19 adviser representative, or other individual was subject to the
331	331	20 person's supervision and committed a violation of this article or
332	332	21 the predecessor act or a rule adopted or order issued under this
333	333	22 article or the predecessor act within the previous ten (10) years;
334	334	23 (10) has not paid the proper filing fee within thirty (30) days after
335	335	24 having been notified by the commissioner of a deficiency, but the
336	336	25 commissioner shall vacate an order under this subdivision when
337	337	26 the deficiency is corrected;
338	338	27 (11) after notice and opportunity for a hearing, has been found
339	339	28 within the previous ten (10) years:
340	340	29 (A) by a court with jurisdiction to have willfully violated the
341	341	30 laws of a foreign jurisdiction under which the business of
342	342	31 securities, commodities, investment, franchises, insurance,
343	343	32 banking, or finance is regulated;
344	344	33 (B) to have been the subject of an order of a securities
345	345	34 regulator of a foreign jurisdiction denying, revoking, or
346	346	35 suspending the right to engage in the business of securities as
347	347	36 a broker-dealer, agent, investment adviser, investment adviser
348	348	37 representative, or similar person; or
349	349	38 (C) to have been suspended or expelled from membership by
350	350	39 or participation in a securities exchange or securities
351	351	40 association operating under the securities laws of a foreign
352	352	41 jurisdiction;
353	353	42 (12) is the subject of a cease and desist order issued by the
354	354	2025 IN 1545—LS 7705/DI 154 9
355	355	1 Securities and Exchange Commission or issued under the
356	356	2 securities, commodities, investment, franchise, banking, finance,
357	357	3 or insurance laws of a state;
358	358	4 (13) has engaged in dishonest or unethical practices in the
359	359	5 securities, commodities, investment, franchise, banking, finance,
360	360	6 or insurance business within the previous ten (10) years;
361	361	7 (14) is not qualified on the basis of factors such as training,
362	362	8 experience, and knowledge of the securities business. However,
363	363	9 in the case of an application by an agent for a broker-dealer that
364	364	10 is a member of a self-regulatory organization or by an individual
365	365	11 for registration as an investment adviser representative, a denial
366	366	12 order may not be based on this subdivision if the individual has
367	367	13 successfully completed all examinations required by subsection
368	368	14 (e). The commissioner may require an applicant for registration
369	369	15 under section 2 or 4 of this chapter who has not been registered
370	370	16 in a state within the two (2) years preceding the filing of an
371	371	17 application in this state to successfully complete an examination;
372	372	18 (15) is on the most recent tax warrant list supplied to the
373	373	19 commissioner by the department of state revenue;
374	374	20 (16) is an individual who is:
375	375	21 (A) an applicant for registration as an agent for a broker-dealer
376	376	22 or as an investment adviser representative; or
377	377	23 (B) registered as an agent for a broker-dealer or as an
378	378	24 investment adviser representative;
379	379	25 and has failed to comply with a court order imposing a child
380	380	26 support obligation; or
381	381	27 (17) fails to comply with the disclosure requirements set forth
382	382	28 under IC 24-4.9-3.
383	383	29 (e) Subject to IC 23-19-4.3, a rule adopted or order issued under
384	384	30 this article may require that an examination, including an examination
385	385	31 developed or approved by an organization of securities regulators, be
386	386	32 successfully completed by a class of individuals or all individuals. An
387	387	33 order issued under this article may waive, in whole or in part, an
388	388	34 examination as to an individual and a rule adopted under this article
389	389	35 may waive, in whole or in part, an examination as to a class of
390	390	36 individuals if the commissioner determines that the examination is not
391	391	37 necessary or appropriate in the public interest and for the protection of
392	392	38 investors.
393	393	39 (f) The commissioner may suspend or deny an application
394	394	40 summarily; restrict, condition, limit, or suspend a registration; or
395	395	41 censure, bar, or impose a civil penalty on a registrant before final
396	396	42 determination of an administrative proceeding. Upon the issuance of
397	397	2025 IN 1545—LS 7705/DI 154 10
398	398	1 an order, the commissioner shall promptly notify each person subject
399	399	2 to the order that the order has been issued, the reasons for the action,
400	400	3 and that within fifteen (15) days after the receipt of a request in a
401	401	4 record from the person the matter will be scheduled for a hearing. If a
402	402	5 hearing is not requested and none is ordered by the commissioner
403	403	6 within thirty (30) days after the date of service of the order, the order
404	404	7 becomes final by operation of law. If a hearing is requested or ordered,
405	405	8 the commissioner, after notice of and opportunity for hearing to each
406	406	9 person subject to the order, may modify or vacate the order or extend
407	407	10 the order until final determination.
408	408	11 (g) An order may not be issued under this section, except under
409	409	12 subsection (f), without:
410	410	13 (1) appropriate notice to the applicant or registrant;
411	411	14 (2) opportunity for hearing; and
412	412	15 (3) findings of fact and conclusions of law in a record.
413	413	16 (h) A person that controls, directly or indirectly, a person not in
414	414	17 compliance with this section may be disciplined by order of the
415	415	18 commissioner under subsections (a) through (c) to the same extent as
416	416	19 the noncomplying person, unless the controlling person did not know,
417	417	20 and in the exercise of reasonable care could not have known, of the
418	418	21 existence of conduct that is a ground for discipline under this section.
419	419	22 (i) The commissioner may not institute a proceeding under
420	420	23 subsection (a), (b), or (c) based solely on material facts actually known
421	421	24 by the commissioner unless an investigation or the proceeding is
422	422	25 instituted within one (1) year after the commissioner actually acquires
423	423	26 knowledge of the material facts.
424	424	27 (j) All fines and penalties collected under this section shall be
425	425	28 deposited into the securities division enforcement account as
426	426	29 established by IC 23-19-6-1(f).
427	427	30 SECTION 5. IC 23-19-4.3 IS ADDED TO THE INDIANA CODE
428	428	31 AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
429	429	32 JULY 1, 2025]:
430	430	33 Chapter 4.3. Examination Requirements and Continuing
431	431	34 Education
432	432	35 Sec. 1. The following definitions apply throughout this chapter:
433	433	36 (1) "Authorized provider" means a person that NASAA or its
434	434	37 designee has authorized to provide continuing education
435	435	38 content.
436	436	39 (2) "Credit" means a unit that has been designated by
437	437	40 NASAA as at least fifty (50) minutes of educational
438	438	41 instruction.
439	439	42 (3) "Ethics and professional responsibility continuing
440	440	2025 IN 1545—LS 7705/DI 154 11
441	441	1 education content" means NASAA approved investment
442	442	2 adviser representative continuing education content that
443	443	3 addresses an investment adviser representative's ethical and
444	444	4 regulatory obligations.
445	445	5 (4) "FINRA" refers to the Financial Industry Regulatory
446	446	6 Authority.
447	447	7 (5) "Home state" means the state where the principal place of
448	448	8 business of an investment adviser representative is located.
449	449	9 (6) "NASAA" refers to the North American Securities
450	450	10 Administrators Association or a committee designated by its
451	451	11 board of directors.
452	452	12 (7) "Products and practice continuing education content"
453	453	13 means NASAA approved investment adviser continuing
454	454	14 education content that addresses an investment adviser
455	455	15 representative's continuing skills and knowledge regarding:
456	456	16 (A) financial products;
457	457	17 (B) investment features; and
458	458	18 (C) practices;
459	459	19 in the investment advisory industry.
460	460	20 (8) "Reporting Period" means one (1) twelve (12) month
461	461	21 period as determined by NASAA.
462	462	22 (9) "Series 7 examination" means the general securities
463	463	23 representative examination administered by FINRA.
464	464	24 (10) "Series 63 examination" means the uniform securities
465	465	25 agent state law examination administered by FINRA.
466	466	26 (11) "Series 65 examination" means the uniform investment
467	467	27 adviser law examination administered by FINRA.
468	468	28 (12) "Series 66 examination" means the uniform combined
469	469	29 state law examination administered by FINRA.
470	470	30 Sec. 2. (a) This section applies to an applicant seeking to register
471	471	31 as an agent of a broker-dealer under IC 23-19-4.
472	472	32 (b) Except as provided in subsections (c) through (f), an
473	473	33 applicant must pass:
474	474	34 (1) the Series 63 or Series 66 examination; and
475	475	35 (2) any other examination required by the commissioner;
476	476	36 within two (2) years of the date of application.
477	477	37 (c) If an applicant registers as an agent in any other state in the
478	478	38 two (2) years before the date of application, the applicant is not
479	479	39 required to take the examinations described in subsection (b).
480	480	40 (d) An applicant is in compliance with the examination
481	481	41 requirement in subsection (b) if the:
482	482	42 (1) applicant has not been registered as an agent in any state
483	483	2025 IN 1545—LS 7705/DI 154 12
484	484	1 for more than two (2) years but less than five (5) years;
485	485	2 (2) applicant is a participant in the Maintaining Qualifications
486	486	3 Program administered by FINRA;
487	487	4 (3) applicant's FINRA qualifying examinations are valid
488	488	5 through the applicant's participation in the Maintaining
489	489	6 Qualifications Program administered by FINRA; and
490	490	7 (4) applicant is a participant in the Examination Validity
491	491	8 Extension Program for agents of broker-dealers administered
492	492	9 by NASAA within two (2) years of agent registration
493	493	10 termination.
494	494	11 (e) An applicant is in compliance with the examination
495	495	12 requirement in subsection (b)(2) if the:
496	496	13 (1) applicant has not been registered as an agent in any state
497	497	14 for more than two (2) years but less than five (5) years;
498	498	15 (2) applicant is a participant in the Maintaining Qualifications
499	499	16 Program administered by FINRA; and
500	500	17 (3) applicant's FINRA qualifying examinations are valid
501	501	18 through the individual's participation in the Maintaining
502	502	19 Qualifications Program administered by FINRA.
503	503	20 (f) The commissioner may waive any of the examination
504	504	21 requirements under subsection (b).
505	505	22 (g) For purposes of investment adviser representative
506	506	23 registration, the validity of an applicant's Series 66 examination
507	507	24 may not be extended through participation in the Maintaining
508	508	25 Qualifications Program administered by FINRA.
509	509	26 Sec. 3. (a) This section applies to an applicant seeking to register
510	510	27 as an investment adviser representative.
511	511	28 (b) Except as provided in subsections (c) through (f), an
512	512	29 applicant under this section must pass the:
513	513	30 (1) Series 65 examination within two (2) years of the date of
514	514	31 application;
515	515	32 (2) Series 66 examination within two (2) years of the date of
516	516	33 application;
517	517	34 (3) Series 7 examination within two (2) years of the date of
518	518	35 application; and
519	519	36 (4) Securities Industry Essential Examination within four (4)
520	520	37 years of the date of application.
521	521	38 (c) If:
522	522	39 (1) an applicant under this section has been designated as:
523	523	40 (A) a Certified Financial Planner;
524	524	41 (B) a Chartered Financial Consultant;
525	525	42 (C) a Masters of Science and Financial Services;
526	526	2025 IN 1545—LS 7705/DI 154 13
527	527	1 (D) a Chartered Financial Analyst;
528	528	2 (E) a Personal Financial Specialist;
529	529	3 (F) a Chartered Investment Counselor; or
530	530	4 (G) any other designation that the commissioner considers
531	531	5 to be equivalent to the Series 65 examination; and
532	532	6 (2) the applicant's designation in subdivision (1) is current
533	533	7 and in good standing with the organization that awarded the
534	534	8 designation;
535	535	9 the examination requirement in subsection (b) does not apply.
536	536	10 (d) If an applicant registers as an investment adviser
537	537	11 representative in any other state in the two (2) years before the
538	538	12 date of application, the applicant is not required to take the
539	539	13 examinations required by section (b) to be eligible for registration.
540	540	14 (e) An applicant is in compliance with the examination
541	541	15 requirement in subsection (b)(1) and (b)(2) if the:
542	542	16 (1) applicant has not been registered as an investment adviser
543	543	17 representative in any state for more than two (2) years but
544	544	18 less than five (5) years;
545	545	19 (2) applicant is a participant in the Maintaining Qualifications
546	546	20 Program administered by FINRA;
547	547	21 (3) applicant's FINRA qualifying examinations are valid
548	548	22 through the individual's participation in the Maintaining
549	549	23 Qualifications Program administered by FINRA; and
550	550	24 (4) applicant is a participant in the Examination Validity
551	551	25 Extension Program for investment adviser representatives
552	552	26 administered by NASAA within two (2) years of agent
553	553	27 registration termination.
554	554	28 (f) An applicant is in compliance with the examination
555	555	29 requirement in subsection (b)(3) and (b)(4) if the:
556	556	30 (1) applicant has not been registered as an investment adviser
557	557	31 representative in any state for more than two (2) years but
558	558	32 less than five (5) years;
559	559	33 (2) applicant is a participant in the Maintaining Qualifications
560	560	34 Program administered by FINRA; and
561	561	35 (3) applicant's FINRA qualifying examinations are valid
562	562	36 through the individual's participation in the Maintaining
563	563	37 Qualifications Program administered by FINRA.
564	564	38 (g) The commissioner may waive any of the examination
565	565	39 requirements under subsection (b).
566	566	40 Sec. 4. (a) An individual who terminates the individual's
567	567	41 registration as an investment adviser representative may have the
568	568	42 validity of the individual's Series 65 examination and the
569	569	2025 IN 1545—LS 7705/DI 154 14
570	570	1 investment adviser representative portion of the Series 66
571	571	2 examination extended indefinitely if the individual meets all of the
572	572	3 following requirements:
573	573	4 (1) The individual previously passed the examination for
574	574	5 which the individual seeks to maintain validity under this
575	575	6 subsection.
576	576	7 (2) The individual was registered as an investment adviser
577	577	8 representative for at least one (1) year immediately preceding
578	578	9 the termination of the investment adviser representative
579	579	10 registration.
580	580	11 (3) The individual was not subject to a statutory
581	581	12 disqualification as defined in section 3(a)(39) of the Securities
582	582	13 Exchange Act of 1934.
583	583	14 (4) The individual does not have a deficiency under the
584	584	15 investment adviser representative continuing education
585	585	16 program described in section 6 of this chapter at the time the
586	586	17 individual terminates the individual's investment adviser
587	587	18 representative registration.
588	588	19 (5) The individual completes annually on or before December
589	589	20 31 of each calendar year that elapses after the individual's
590	590	21 investment adviser representative registration is terminated,
591	591	22 regardless of when the individual elects to participate in the
592	592	23 Examination Validity Extension Program for investment
593	593	24 adviser representatives administered by NASAA:
594	594	25 (A) six (6) credits of ethics and professional responsibility
595	595	26 continuing education content offered by an authorized
596	596	27 provider, including at least three (3) hours covering the
597	597	28 topic of ethics; and
598	598	29 (B) six (6) credits of products and practice continuing
599	599	30 education content offered by an authorized provider.
600	600	31 (b) An individual who complies with the Maintaining
601	601	32 Qualification Program administered by FINRA is in compliance
602	602	33 with subsection (a)(5)(B).
603	603	34 Sec. 5. An individual's Series 65 examination and the investment
604	604	35 adviser representative portion of the Series 66 examination is valid
605	605	36 for a period of five (5) years after the individual terminates the
606	606	37 individual's registration as an investment adviser representative,
607	607	38 regardless of whether the individual has been employed by or
608	608	39 associated with an investment adviser or federal covered
609	609	40 investment adviser.
610	610	41 Sec. 6. (a) Except as provided in subsections (b) and (c), an
611	611	42 investment adviser representative registered under IC 23-19-4
612	612	2025 IN 1545—LS 7705/DI 154 15
613	613	1 shall complete the following investment adviser representative
614	614	2 continuing education requirements each reporting period:
615	615	3 (1) Six (6) credits of investment adviser representative ethics
616	616	4 and professional responsibility continuing education content
617	617	5 offered by an authorized provider, with at least three (3)
618	618	6 hours covering the topic of ethics.
619	619	7 (2) Six (6) credits of investment adviser representative
620	620	8 products and practice continuing education content offered by
621	621	9 an authorized provider.
622	622	10 (b) An investment adviser representative who is registered as an
623	623	11 agent of a FINRA member broker-dealer and complies with
624	624	12 FINRA's continuing education requirements is in compliance with
625	625	13 subsection (a)(2) for each applicable reporting period if the FINRA
626	626	14 continuing education content meets all of the following criteria as
627	627	15 determined by NASAA:
628	628	16 (1) The content of the program focuses on:
629	629	17 (A) compliance;
630	630	18 (B) regulatory;
631	631	19 (C) ethical; and
632	632	20 (D) sales practice;
633	633	21 standards.
634	634	22 (2) The content of the program is derived from:
635	635	23 (A) state and federal investment advisory statutes;
636	636	24 (B) rules and regulations;
637	637	25 (C) securities industry rules and regulations; and
638	638	26 (D) accepted standards and practices in the financial
639	639	27 services industry.
640	640	28 (3) The program requires that its participants demonstrate
641	641	29 proficiency in the subject matter of the educational materials.
642	642	30 (c) If an investment adviser representative who holds a
643	643	31 designation that qualifies the individual for an examination waiver
644	644	32 under section 3(c) of this chapter completes continuing education
645	645	33 content as a condition of maintaining the individual's designation,
646	646	34 the individual complies with subsection (a) if the continuing
647	647	35 education content:
648	648	36 (1) completed during the relevant reporting period by the
649	649	37 investment adviser representative is mandatory to maintain
650	650	38 the designation; and
651	651	39 (2) provided by the designating organization during the
652	652	40 relevant reporting period is NASAA approved investment
653	653	41 adviser representative continuing education content.
654	654	42 (d) An investment adviser representative who fails to comply
655	655	2025 IN 1545—LS 7705/DI 154 16
656	656	1 with this section by the end of a reporting period will renew as "CE
657	657	2 Inactive" at the close of the calendar year until the investment
658	658	3 adviser representative completes and reports all required
659	659	4 investment adviser representative continuing education credits. An
660	660	5 investment adviser representative who is "CE Inactive" at the
661	661	6 close of the next calendar year is not eligible for investment adviser
662	662	7 representative registration or renewal of an investment adviser
663	663	8 representative registration under IC 23-19-4.
664	664	9 Sec. 7. If an investment adviser representative's registration is
665	665	10 terminated, the individual shall complete the investment adviser
666	666	11 representative continuing education requirements for all reporting
667	667	12 periods that occurred between the time that the investment adviser
668	668	13 representative's registration is terminated and when the individual
669	669	14 became registered again under IC 23-19-4 unless the investment
670	670	15 adviser representative:
671	671	16 (1) passes the applicable examination described in section 3(b)
672	672	17 of this chapter; or
673	673	18 (2) receives an examination waiver under section 3(c) through
674	674	19 3(e) of this chapter.
675	675	20 Sec. 8. An authorized provider shall report the completion of an
676	676	21 investment adviser representative's applicable investment adviser
677	677	22 representative continuing education requirements to the
678	678	23 commissioner not more than thirty (30) days after the investment
679	679	24 adviser representative completes the applicable investment adviser
680	680	25 representative continuing education requirements.
681	681	26 Sec. 9. An investment adviser representative registered or
682	682	27 required to be registered in Indiana who is registered as an
683	683	28 investment adviser representative in the individual's home state
684	684	29 satisfies the requirements of section 6(a) of this chapter if:
685	685	30 (1) the investment adviser representative's home state has
686	686	31 continuing education requirements that are at least as
687	687	32 stringent as the continuing education requirements of this
688	688	33 chapter; and
689	689	34 (2) the investment adviser representative is in compliance
690	690	35 with the home state's investment adviser representative
691	691	36 continuing education requirements.
692	692	37 Sec. 10. An investment adviser representative who completes
693	693	38 more than twelve (12) credits of continuing education for the
694	694	39 reporting period may not carry forward the excess credits of
695	695	40 continuing education.
696	696	41 Sec. 11. The commissioner may waive any of the requirements
697	697	42 in sections 6 through 10 of this chapter.
698	698	2025 IN 1545—LS 7705/DI 154 17
699	699	1 SECTION 6. [EFFECTIVE JULY 1, 2025] (a) The securities
700	700	2 division of the office of the secretary of state shall amend its
701	701	3 administrative rules to conform with IC 23-19-4.3, as added by this
702	702	4 act.
703	703	5 (b) This SECTION expires July 1, 2028.
704	704	2025 IN 1545—LS 7705/DI 154