Shown verbatim: the complete text as captured from the official PDF posted by the Indiana General Assembly, fetched 2026-09-25. Page and line markers are part of the official record; nothing is edited or removed. This is the current version. The official bill page.
Second Regular Session of the 124th General Assembly (2026)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in this style type. Also, the
word NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
between statutes enacted by the 2025 Regular Session of the General Assembly.
HOUSE ENROLLED ACT No. 1336
AN ACT to amend the Indiana Code concerning business and other
associations.
Be it enacted by the General Assembly of the State of Indiana:
SECTION 1. IC 23-19-4-1, AS ADDED BY P.L.27-2007,
SECTION 23, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2026]: Sec. 1. (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 section 1.5 of this chapter or 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
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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
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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).
SECTION 2. IC 23-19-4-1.5 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2026]: Sec. 1.5. (a) As used in this section, "business combination
related shell company" has the meaning set forth in 15 U.S.C.
78o(b)(13)(E)(i), as in effect on July 1, 2026.
(b) As used in this section, "eligible privately held company" has
the meaning set forth in 15 U.S.C. 78o(b)(13)(E)(iii), as in effect on
July 1, 2026.
(c) As used in this section, "merger and acquisition broker" has
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the meaning set forth in 15 U.S.C. 78o(b)(13)(E)(iv), as in effect on
July 1, 2026.
(d) As used in this section, "passive buyer" means a person or
a group of people that acquire ownership of an eligible privately
held company, but does not direct the management or policies of
the eligible privately held company after the transaction.
(e) As used in this section, "shell company" has the meaning set
forth in 15 U.S.C. 78o(b)(13)(E)(v), as in effect on July 1, 2026.
(f) Except as provided in subsections (g) and (h), a merger and
acquisition broker shall be exempt from registration as a
broker-dealer under this article.
(g) A merger and acquisition broker is not exempt from
registration under subsection (f) if the merger and acquisition
broker does any of the following:
(1) Directly or indirectly, in connection with the transfer of
ownership of an eligible privately held company, receives,
holds, transmits, or has custody of the funds or securities to be
exchanged by the parties to the transaction.
(2) Engages on behalf of an issuer in a public offering of any
class of securities that is registered, or is required to be
registered, with the Securities and Exchange Commission
under 15 U.S.C. 78l.
(3) Engages on behalf of an issuer in a public offering of any
class of securities that the issuer files, or is required to file,
periodic information, documents, and reports under 15 U.S.C.
78o(d).
(4) Engages on behalf of any party in a transaction involving
a shell company other than a business combination related
shell company.
(5) Directly or indirectly, through any of its affiliates,
provides financing related to the transfer of ownership of an
eligible privately held company.
(6) Assists any party in obtaining financing from an
unaffiliated third party without:
(A) complying with all applicable laws in connection with
providing the assistance described in this subdivision,
including, if applicable, Regulation T (12 CFR 220 et seq.);
and
(B) disclosing any compensation received by the merger
and acquisition broker in writing to the party.
(7) Represents both the buyer and the seller in the same
transaction without providing a clear written disclosure
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describing who the merger and acquisition broker represents
and obtaining written consent from the buyer and the seller
to the joint representation.
(8) Facilitates a transaction with a group of buyers formed
with the assistance of the merger and acquisition broker to
acquire an eligible privately held company.
(9) Engages in a transaction involving the transfer of
ownership of an eligible privately held company to a passive
buyer or a group of passive buyers.
(10) Binds a party to a transfer of ownership of an eligible
privately held company.
(h) A merger and acquisition broker or an officer, director,
member, manager, partner, or employee of the merger and
acquisition broker is not exempt from registration under
subsection (f) if the merger and acquisition broker or an officer,
director, member, manager, partner, or employee of the merger
and acquisition broker:
(1) has been barred from association with a broker-dealer by
the Securities and Exchange Commission, any state, or any
self-regulatory organization; or
(2) is suspended from association with a broker-dealer.
SECTION 3. IC 23-19-4-6, AS AMENDED BY P.L.114-2010,
SECTION 9, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2026]: Sec. 6. (a) A person shall register as a broker-dealer,
agent, investment adviser, or investment adviser representative by
filing an application and a consent to service of process complying with
IC 23-19-6-11, satisfying the examination requirements of
IC 23-19-4.3, and paying the fee specified in section 10 of this chapter
and any reasonable fees charged by the designee of the commissioner
for processing the filing. The application must contain:
(1) the information or record required for the filing of a uniform
application; and
(2) upon request by the commissioner, any other financial or other
information or record that the commissioner determines is
appropriate.
(b) If the information or record contained in an application filed
under subsection (a) is or becomes inaccurate or incomplete in a
material respect, the registrant shall promptly file a correcting
amendment.
(c) At the time of application for an initial registration as an
investment adviser representative under this article, the commissioner
shall require each applicant to submit fingerprints for a national
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criminal history background check (as defined in IC 10-13-3-12) by the
Federal Bureau of Investigation, for use by the commissioner in
determining whether the applicant should be denied registration under
this chapter for any reason set forth in section 12(d) of this chapter. The
applicant shall pay any fees or costs associated with the fingerprints
and background check required under this subsection.
(d) If an order is not in effect and a proceeding is not pending under
section 12 of this chapter, registration becomes effective at noon on the
forty-fifth day after a completed application is filed, unless the
registration is denied. A rule adopted or order issued under this article
may set an earlier effective date or may defer the effective date until
noon on the forty-fifth day after the filing of any amendment
completing the application.
(e) A registration is effective until midnight on December 31 of the
year for which the application for registration is filed. Unless an order
is in effect under section 12 of this chapter, a registration may be
automatically renewed each year by filing such records as are required
by rule adopted or order issued under this article, by paying the fee
specified in section 10 of this chapter, and by paying costs charged by
the designee of the commissioner for processing the filings.
(f) A rule adopted or order issued under this article may impose
other conditions, not inconsistent with the National Securities Markets
Improvement Act of 1996. An order issued under this article may
waive, in whole or in part, specific requirements in connection with
registration as are in the public interest and for the protection of
investors.
SECTION 4. IC 23-19-4-11, AS AMENDED BY P.L.1-2010,
SECTION 94, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2026]: Sec. 11. (a) Subject to Section 15(h) of the Securities
Exchange Act of 1934 (15 U.S.C. 78o(h)) or Section 222 of the
Investment Advisers Act of 1940 (15 U.S.C. 80b-18a), a rule adopted
or order issued under this article may establish minimum financial
requirements for broker-dealers registered or required to be registered
under this article and investment advisers registered or required to be
registered under this article.
(b) Subject to Section 15(h) of the Securities Exchange Act of 1934
(15 U.S.C. 78o(h)) or Section 222(b) of the Investment Advisers Act
of 1940 (15 U.S.C. 80b-18a(b)), a broker-dealer registered or required
to be registered under this article and an investment adviser registered
or required to be registered under this article shall file such financial
reports as are required by a rule adopted or order issued under this
article. If the information contained in a record filed under this
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subsection is or becomes inaccurate or incomplete in a material
respect, the registrant shall promptly file a correcting amendment.
(c) Subject to Section 15(h) of the Securities Exchange Act of 1934
(15 U.S.C. 78o(h)) or Section 222 of the Investment Advisers Act of
1940 (15 U.S.C. 80b-18a):
(1) a broker-dealer registered or required to be registered under
this article and an investment adviser registered or required to be
registered under this article shall make and maintain the accounts,
correspondence, memoranda, papers, books, and other records
required by rule adopted or order issued under this article;
(2) broker-dealer records required to be maintained under
subdivision (1) may be maintained in any form of data storage
acceptable under Section 17(a) of the Securities Exchange Act of
1934 (15 U.S.C. 78q(a)) if they are readily accessible to the
commissioner; and
(3) investment adviser records required to be maintained under
subdivision (1) may be maintained in any form of data storage
required by rule adopted or order issued under this article.
(d) The records of a broker-dealer registered or required to be
registered under this article and of an investment adviser registered or
required to be registered under this article are subject to such
reasonable periodic, special, or other audits or inspections by a
representative of the commissioner, within or outside this state, as the
commissioner considers necessary or appropriate in the public interest
and for the protection of investors. An audit or inspection may be made
at any time and without prior notice. The commissioner may copy, and
remove for audit or inspection copies of, all records the commissioner
reasonably considers necessary or appropriate to conduct the audit or
inspection. The commissioner may assess a reasonable charge for
conducting an audit or inspection under this subsection.
(e) Subject to Section 15(h) of the Securities Exchange Act of 1934
(15 U.S.C. 78o(h)) or Section 222 of the Investment Advisers Act of
1940 (15 U.S.C. 80b-18a), a rule adopted or order issued under this
article may require a broker-dealer or investment adviser that has
custody of or discretionary authority over funds or securities of a
customer or client to obtain insurance or post a bond or other
satisfactory form of security in an amount not to exceed fifty thousand
dollars ($50,000). The commissioner may determine the requirements
of the insurance, bond, or other satisfactory form of security. Insurance
or a bond or other satisfactory form of security may not be required of
a broker-dealer registered under this article whose net capital exceeds,
or of an investment adviser registered under this article whose
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minimum financial requirements exceed, the amounts required by rule
or order under this article. The insurance, bond, or other satisfactory
form of security must permit an action by a person to enforce any
liability on the insurance, bond, or other satisfactory form of security
if instituted within the time limitations in IC 23-19-5-9(g).
(f) Subject to Section 15(h) of the Securities Exchange Act of 1934
(15 U.S.C. 78o(h)) or Section 222 of the Investment Advisers Act of
1940 (15 U.S.C. 80b-18a), an agent may not have custody of funds or
securities of a customer except under the supervision of a broker-dealer
and an investment adviser representative may not have custody of
funds or securities of a client except under the supervision of an
investment adviser or a federal covered investment adviser. A rule
adopted or order issued under this article may prohibit, limit, or impose
conditions on a broker-dealer regarding custody of funds or securities
of a customer and on an investment adviser regarding custody of
securities or funds of a client.
(g) With respect to an investment adviser registered or required to
be registered under this article, a rule adopted or order issued under
this article may require that information or other records be furnished
or disseminated to clients or prospective clients in this state as
necessary or appropriate in the public interest and for the protection of
investors and advisory clients.
(h) A rule adopted or order issued under this article may require an
individual registered under section 2 or 4 of this chapter to participate
in a continuing education program approved by the Securities and
Exchange Commission and administered by a self-regulatory
organization or, in the absence of such a program, a rule adopted or
order issued under this article may require continuing education for an
individual registered under section 4 of this chapter.
(i) (h) Subject to section 11.5 of this chapter, the commissioner may
annually select as many as twenty-five percent (25%) of all Indiana
home and branch offices of registered broker-dealers for completion of
compliance reports. Subject to section 11.5 of this chapter, each
broker-dealer office that is selected shall file its compliance report
according to rules adopted by the commissioner under this article not
later than forty-five (45) days after being notified of selection under
this subsection. No charges or other examination fees may be assessed
against a registered broker-dealer as a result of the examination of a
compliance report filed under this subsection unless the examination
results in an investigation or examination made under IC 23-19-6-2(a).
SECTION 5. IC 23-19-4-11.5, AS ADDED BY P.L.149-2009,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
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JULY 1, 2026]: Sec. 11.5. (a) As used in this section, "office of
supervisory jurisdiction" has the meaning set forth in the National
Association of Securities Dealers Conduct Rule 3010(g) (as in effect
on January 1, 2009).
(b) A broker-dealer registered or required to be registered under this
article may not be selected for completion of a compliance report under
section 11(i) 11(h) of this chapter in consecutive years unless the
commissioner has reason to believe that the broker-dealer has
committed a violation of this article.
(c) The commissioner may not select for completion of a
compliance report under section 11(i) 11(h) of this chapter any office
that:
(1) reports to an office of supervisory jurisdiction located within
Indiana;
(2) reflects the address of the office of supervisory jurisdiction
described in subdivision (1) on all of the office's business cards,
stationery, advertisements, and other communications to the
public; and
(3) is included in the definition of branch office under the
National Association of Securities Dealers Conduct Rule 3010(g)
because the office:
(A) handles funds or securities as described under the National
Association of Securities Dealers Conduct Rule
3010(g)(2)(A)(ii)(c); or
(B) uses the residential address on all business cards,
stationery, advertisements, or other communications to the
public under the National Association of Securities Dealers
Conduct Rule 3010(g)(2)(A)(ii)(d).
SECTION 6. IC 23-19-4-12, AS AMENDED BY P.L.205-2021,
SECTION 6, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2026]: Sec. 12. (a) If the commissioner finds that the order is
in the public interest and subsection (d) authorizes the action, an order
issued under this article may deny an application, or may condition or
limit registration, of an applicant to be a broker-dealer, agent,
investment adviser, or investment adviser representative and, if the
applicant is a broker-dealer or investment adviser, of a partner, officer,
director, or person having a similar status or performing similar
functions, or a person directly or indirectly in control of the
broker-dealer or investment adviser.
(b) If the commissioner finds that the order is in the public interest
and subsection (d) authorizes the action, an order issued under this
article may revoke, suspend, condition, or limit the registration of a
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registrant and, if the registrant is a broker-dealer or investment adviser,
of a partner, officer, director, or person having a similar status or
performing similar functions, or a person directly or indirectly in
control of the broker-dealer or investment adviser. However, the
commissioner may not:
(1) institute a revocation or suspension proceeding under this
subsection based on an order issued under a law of another state
that is reported to the commissioner or a designee of the
commissioner more than one (1) year after the date of the order on
which it is based; or
(2) under subsection (d)(5)(A) and (d)(5)(B), issue an order on
the basis of an order issued under the securities act of another
state unless the other order was based on conduct for which
subsection (d) would authorize the action had the conduct
occurred in this state.
(c) If the commissioner finds that the order is in the public interest
and subsection (d)(1), (d)(2), (d)(3), (d)(4), (d)(5), (d)(6), (d)(8), (d)(9),
(d)(11), (d)(12), or (d)(13) authorizes the action, an order under this
article may censure, impose a bar, or impose a civil penalty in an
amount not to exceed a maximum of ten thousand dollars ($10,000) per
violation on a registrant, and, if the registrant is a broker-dealer or
investment adviser, a partner, officer, director, or person having a
similar status or performing similar functions, or a person directly or
indirectly in control of the broker-dealer or investment adviser.
(d) A person may be disciplined under subsections (a) through (c)
if the person:
(1) has filed an application for registration in this state under this
article or the predecessor act within the previous ten (10) years,
which, as of the effective date of registration or as of any date
after filing in the case of an order denying effectiveness, was
incomplete in any material respect or contained a statement that,
in light of the circumstances under which it was made, was false
or misleading with respect to a material fact;
(2) knowingly violated or knowingly failed to comply with this
article or the predecessor act or a rule adopted or order issued
under this article or the predecessor act within the previous ten
(10) years;
(3) has been convicted of a felony or within the previous ten (10)
years has been convicted of a misdemeanor involving a security,
a commodity future or option contract, or an aspect of a business
involving securities, commodities, investments, franchises,
insurance, banking, or finance;
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(4) is enjoined or restrained by a court with jurisdiction in an
action instituted by the commissioner under this article or the
predecessor act, a state, the Securities and Exchange Commission,
or the United States from engaging in or continuing an act,
practice, or course of business involving an aspect of a business
involving securities, commodities, investments, franchises,
insurance, banking, or finance;
(5) is the subject of an order, issued after notice and opportunity
for hearing, by:
(A) the securities, depository institution, insurance, or other
financial services regulator of a state or by the Securities and
Exchange Commission or other federal agency denying,
revoking, barring, or suspending registration as a
broker-dealer, agent, investment adviser, federal covered
investment adviser, or investment adviser representative;
(B) the securities regulator of a state or the Securities and
Exchange Commission against a broker-dealer, agent,
investment adviser, investment adviser representative, or
federal covered investment adviser;
(C) the Securities and Exchange Commission or a
self-regulatory organization suspending or expelling the
registrant from membership in the self-regulatory
organization;
(D) a court adjudicating a United States Postal Service fraud
order;
(E) the insurance regulator of a state denying, suspending, or
revoking registration as an insurance agent;
(F) a depository institution regulator suspending or barring the
person from the depository institution business; or
(G) any state regulatory body or organization governing real
estate brokers or sales persons denying, suspending, or
revoking a person's registration or license in the real estate
industry;
(6) is the subject of an adjudication or determination, after notice
and opportunity for hearing, by the Securities and Exchange
Commission, the Commodity Futures Trading Commission, the
Federal Trade Commission, a federal depository institution
regulator, or a depository institution, insurance, or other financial
services regulator of a state that the person willfully violated the
Securities Act of 1933, the Securities Exchange Act of 1934, the
Investment Advisers Act of 1940, the Investment Company Act
of 1940, or the Commodity Exchange Act, the securities or
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commodities law of a state, or a federal or state law under which
a business involving investments, franchises, insurance, banking,
or finance is regulated;
(7) is insolvent, either because the person's liabilities exceed the
person's assets or because the person cannot meet the person's
obligations as they mature, but the commissioner may not enter an
order against an applicant or registrant under this subdivision
without a finding of insolvency as to the applicant or registrant;
(8) refuses to allow or otherwise impedes the commissioner from
conducting an audit or inspection under section 11(d) of this
chapter or refuses access to a registrant's office to conduct an
audit or inspection under section 11(d) of this chapter;
(9) has failed to reasonably supervise an agent, investment adviser
representative, or other individual, if the agent, investment
adviser representative, or other individual was subject to the
person's supervision and committed a violation of this article or
the predecessor act or a rule adopted or order issued under this
article or the predecessor act within the previous ten (10) years;
(10) has not paid the proper filing fee within thirty (30) days after
having been notified by the commissioner of a deficiency, but the
commissioner shall vacate an order under this subdivision when
the deficiency is corrected;
(11) after notice and opportunity for a hearing, has been found
within the previous ten (10) years:
(A) by a court with jurisdiction to have willfully violated the
laws of a foreign jurisdiction under which the business of
securities, commodities, investment, franchises, insurance,
banking, or finance is regulated;
(B) to have been the subject of an order of a securities
regulator of a foreign jurisdiction denying, revoking, or
suspending the right to engage in the business of securities as
a broker-dealer, agent, investment adviser, investment adviser
representative, or similar person; or
(C) to have been suspended or expelled from membership by
or participation in a securities exchange or securities
association operating under the securities laws of a foreign
jurisdiction;
(12) is the subject of a cease and desist order issued by the
Securities and Exchange Commission or issued under the
securities, commodities, investment, franchise, banking, finance,
or insurance laws of a state;
(13) has engaged in dishonest or unethical practices in the
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securities, commodities, investment, franchise, banking, finance,
or insurance business within the previous ten (10) years;
(14) is not qualified on the basis of factors such as training,
experience, and knowledge of the securities business. However,
in the case of an application by an agent for a broker-dealer that
is a member of a self-regulatory organization or by an individual
for registration as an investment adviser representative, a denial
order may not be based on this subdivision if the individual has
successfully completed all examinations required by subsection
(e). The commissioner may require an applicant for registration
under section 2 or 4 of this chapter who has not been registered
in a state within the two (2) years preceding the filing of an
application in this state to successfully complete an examination;
(15) is on the most recent tax warrant list supplied to the
commissioner by the department of state revenue;
(16) is an individual who is:
(A) an applicant for registration as an agent for a broker-dealer
or as an investment adviser representative; or
(B) registered as an agent for a broker-dealer or as an
investment adviser representative;
and has failed to comply with a court order imposing a child
support obligation; or
(17) fails to comply with the disclosure requirements set forth
under IC 24-4.9-3.
(e) Subject to IC 23-19-4.3, a rule adopted or order issued under
this article may require that an examination, including an examination
developed or approved by an organization of securities regulators, be
successfully completed by a class of individuals or all individuals. An
order issued under this article may waive, in whole or in part, an
examination as to an individual and a rule adopted under this article
may waive, in whole or in part, an examination as to a class of
individuals if the commissioner determines that the examination is not
necessary or appropriate in the public interest and for the protection of
investors.
(f) The commissioner may suspend or deny an application
summarily; restrict, condition, limit, or suspend a registration; or
censure, bar, or impose a civil penalty on a registrant before final
determination of an administrative proceeding. Upon the issuance of
an order, the commissioner shall promptly notify each person subject
to the order that the order has been issued, the reasons for the action,
and that within fifteen (15) days after the receipt of a request in a
record from the person the matter will be scheduled for a hearing. If a
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hearing is not requested and none is ordered by the commissioner
within thirty (30) days after the date of service of the order, the order
becomes final by operation of law. If a hearing is requested or ordered,
the commissioner, after notice of and opportunity for hearing to each
person subject to the order, may modify or vacate the order or extend
the order until final determination.
(g) An order may not be issued under this section, except under
subsection (f), without:
(1) appropriate notice to the applicant or registrant;
(2) opportunity for hearing; and
(3) findings of fact and conclusions of law in a record.
(h) A person that controls, directly or indirectly, a person not in
compliance with this section may be disciplined by order of the
commissioner under subsections (a) through (c) to the same extent as
the noncomplying person, unless the controlling person did not know,
and in the exercise of reasonable care could not have known, of the
existence of conduct that is a ground for discipline under this section.
(i) The commissioner may not institute a proceeding under
subsection (a), (b), or (c) based solely on material facts actually known
by the commissioner unless an investigation or the proceeding is
instituted within one (1) year after the commissioner actually acquires
knowledge of the material facts.
(j) All fines and penalties collected under this section shall be
deposited into the securities division enforcement account as
established by IC 23-19-6-1(f).
SECTION 7. IC 23-19-4.3 IS ADDED TO THE INDIANA CODE
AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2026]:
Chapter 4.3. Examination Requirements and Continuing
Education
Sec. 1. The following definitions apply throughout this chapter:
(1) "Authorized provider" means a person that NASAA or its
designee has authorized to provide continuing education
content.
(2) "Credit" means a unit that has been designated by
NASAA as at least fifty (50) minutes of educational
instruction.
(3) "Ethics and professional responsibility continuing
education content" means NASAA approved investment
adviser representative continuing education content that
addresses an investment adviser representative's ethical and
regulatory obligations.
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(4) "FINRA" refers to the Financial Industry Regulatory
Authority.
(5) "Home state" means the state where the principal office
and place of business of an investment adviser representative
is located.
(6) "NASAA" refers to the North American Securities
Administrators Association or a committee designated by its
board of directors.
(7) "Products and practice continuing education content"
means NASAA approved investment adviser continuing
education content that addresses an investment adviser
representative's continuing skills and knowledge regarding:
(A) financial products;
(B) investment features; and
(C) practices;
in the investment advisory industry.
(8) "Reporting period" means one (1) twelve (12) month
period as determined by NASAA.
(9) "Series 7 examination" means the general securities
representative examination administered by FINRA.
(10) "Series 63 examination" means the uniform securities
agent state law examination administered by FINRA.
(11) "Series 65 examination" means the uniform investment
adviser law examination administered by FINRA.
(12) "Series 66 examination" means the uniform combined
state law examination administered by FINRA.
Sec. 2. (a) This section applies to an applicant seeking to register
as an agent of a broker-dealer under IC 23-19-4.
(b) Except as provided in subsections (c) through (e), an
applicant must pass:
(1) the Series 63 or Series 66 examination; and
(2) any other examination required by the commissioner;
within the two (2) years preceding the date of application.
(c) An applicant is in compliance with the examination
requirement under subsection (b) if the:
(1) applicant has not been registered as an agent in any state
for more than two (2) years but less than five (5) years;
(2) applicant is a participant in the Maintaining Qualifications
Program administered by FINRA;
(3) applicant's FINRA qualifying examinations are valid
through the applicant's participation in the Maintaining
Qualifications Program administered by FINRA; and
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(4) applicant is a participant in the Examination Validity
Extension Program for agents of broker-dealers administered
by NASAA within two (2) years of agent registration
termination.
(d) An applicant is in compliance with the examination
requirement in subsection (b)(2) if the:
(1) applicant has not been registered as an agent in any state
for more than two (2) years but less than five (5) years;
(2) applicant is a participant in the Maintaining Qualifications
Program administered by FINRA; and
(3) applicant's FINRA qualifying examinations are valid
through the individual's participation in the Maintaining
Qualifications Program administered by FINRA.
(e) The commissioner may waive any of the examination
requirements under subsection (b).
(f) For purposes of investment adviser representative
registration, the validity of an applicant's investment adviser
representative portion of the Series 66 examination may not be
extended through participation in the Maintaining Qualifications
Program administered by FINRA.
Sec. 3. (a) This section applies to an applicant seeking to register
as an investment adviser representative.
(b) Except as provided in subsections (c) through (e), an
applicant under this section must pass the:
(1) Series 65 examination within the two (2) years preceding
the date of application or the Series 7 and Series 66
examination within the two (2) years preceding the date of
application; and
(2) Securities Industry Essentials Examination within the four
(4) years preceding the date of application, if the applicant did
not take the Series 65 examination within the two (2) years
preceding the date of application.
(c) If:
(1) an applicant under this section has been designated as:
(A) a Certified Financial Planner;
(B) a Chartered Financial Consultant;
(C) a Chartered Financial Analyst;
(D) a Personal Financial Specialist;
(E) a Certified Investment Management Analyst; and
(F) any other designation that the commissioner considers
to be equivalent to the examinations required under
subsection (b); and
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(2) the applicant's designation in subdivision (1) is current
and in good standing with the organization that awarded the
designation;
the examination requirement in subsection (b) does not apply.
(d) An applicant is in compliance with the examination
requirement in subsection (b)(1) if the:
(1) applicant has not been registered as an investment adviser
representative in any state for more than two (2) years but
less than five (5) years;
(2) applicant is a participant in the Maintaining Qualifications
Program administered by FINRA;
(3) applicant's FINRA qualifying examinations are valid
through the individual's participation in the Maintaining
Qualifications Program administered by FINRA; and
(4) applicant is a participant in the Examination Validity
Extension Program for investment adviser representatives
administered by NASAA within two (2) years of agent
registration termination.
(e) An applicant is in compliance with the examination
requirement in subsection (b)(2) if the:
(1) applicant has not been registered as an investment adviser
representative in any state for more than two (2) years but
less than five (5) years;
(2) applicant is a participant in the Maintaining Qualifications
Program administered by FINRA; and
(3) applicant's FINRA qualifying examinations are valid
through the individual's participation in the Maintaining
Qualifications Program administered by FINRA.
(f) The commissioner may waive any of the examination
requirements under subsection (b).
Sec. 4. (a) An individual who terminates the individual's
registration as an investment adviser representative may have the
validity of the individual's Series 65 examination and the
investment adviser representative portion of the Series 66
examination extended for a period of five (5) years, if the
individual meets all of the following requirements:
(1) The individual previously passed the examination for
which the individual seeks to maintain validity under this
subsection.
(2) The individual was registered as an investment adviser
representative for at least one (1) year immediately preceding
the termination of the investment adviser representative
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18
registration.
(3) The individual was not subject to a statutory
disqualification as defined in Section 3(a)(39) of the Securities
Exchange Act of 1934.
(4) The individual does not have a deficiency under the
investment adviser representative continuing education
program described in section 6 of this chapter at the time the
individual terminates the individual's investment adviser
representative registration.
(5) The individual completes annually on or before December
31 of each calendar year that elapses after the individual's
investment adviser representative registration is terminated:
(A) six (6) credits of ethics and professional responsibility
continuing education content offered by an authorized
provider, including at least three (3) hours covering the
topic of ethics; and
(B) six (6) credits of products and practice continuing
education content offered by an authorized provider.
(b) An individual who complies with the Maintaining
Qualification Program administered by FINRA is in compliance
with subsection (a)(5)(B).
Sec. 5. (a) Except as provided in subsections (b) and (c), an
investment adviser representative registered under IC 23-19-4
shall complete the following investment adviser representative
continuing education requirements each reporting period:
(1) Six (6) credits of investment adviser representative ethics
and professional responsibility continuing education content
offered by an authorized provider, with at least three (3)
hours covering the topic of ethics.
(2) Six (6) credits of investment adviser representative
products and practice continuing education content offered by
an authorized provider.
(b) An investment adviser representative who is registered as an
agent of a FINRA member broker-dealer and complies with
FINRA's continuing education requirements is in compliance with
subsection (a)(2) for each applicable reporting period if the FINRA
continuing education content meets all of the following criteria as
determined by NASAA:
(1) The content of the program focuses on:
(A) compliance;
(B) regulatory;
(C) ethical; and
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19
(D) sales practice;
standards.
(2) The content of the program is derived from:
(A) state and federal investment advisory statutes;
(B) rules and regulations;
(C) securities industry rules and regulations; and
(D) accepted standards and practices in the financial
services industry.
(3) The program requires that its participants demonstrate
proficiency in the subject matter of the educational materials.
(c) If an investment adviser representative who holds a
designation that qualifies the individual for an examination waiver
under section 3(c) of this chapter completes continuing education
content as a condition of maintaining the individual's designation,
the individual complies with subsection (a) if the continuing
education content:
(1) completed during the relevant reporting period by the
investment adviser representative is mandatory to maintain
the designation; and
(2) provided by the designating organization during the
relevant reporting period is NASAA approved investment
adviser representative continuing education content.
(d) An investment adviser representative who fails to comply
with this section by the end of a reporting period will renew as "CE
Inactive" at the close of the calendar year until the investment
adviser representative completes and reports all required
investment adviser representative continuing education credits. An
investment adviser representative who is "CE Inactive" at the
close of the next calendar year is not eligible for investment adviser
representative registration or renewal of an investment adviser
representative registration under IC 23-19-4.
Sec. 6. If an investment adviser representative's registration is
terminated, the individual shall complete the investment adviser
representative continuing education requirements for all reporting
periods that occurred between the time that the investment adviser
representative's registration is terminated and when the individual
became registered again under IC 23-19-4 unless the investment
adviser representative:
(1) passes the applicable examination described in section 3(b)
of this chapter; or
(2) receives an examination waiver under section 3(c) through
3(e) of this chapter.
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Sec. 7. An authorized provider shall report the completion of an
investment adviser representative's applicable investment adviser
representative continuing education requirements to FINRA not
more than thirty (30) days after the investment adviser
representative completes the applicable investment adviser
representative continuing education requirements.
Sec. 8. An investment adviser representative registered or
required to be registered in Indiana who is registered as an
investment adviser representative in the individual's home state
satisfies the requirements of section 5(a) of this chapter if:
(1) the investment adviser representative's home state has
continuing education requirements that are at least as
stringent as the continuing education requirements of this
chapter; and
(2) the investment adviser representative is in compliance
with the home state's investment adviser representative
continuing education requirements.
Sec. 9. An investment adviser representative who completes
more than twelve (12) credits of continuing education for the
reporting period may not carry forward the excess credits of
continuing education.
Sec. 10. The commissioner may waive any of the requirements
in sections 5 through 9 of this chapter.
SECTION 8. [EFFECTIVE JULY 1, 2026] (a) The securities
division of the office of the secretary of state shall amend its
administrative rules to conform with IC 23-19-4.3, as added by this
act.
(b) This SECTION expires July 1, 2029.
HEA 1336 — Concur
Speaker of the House of Representatives
President of the Senate
President Pro Tempore
Governor of the State of Indiana
Date: Time:
HEA 1336 — ConcurEvery fact on this page links to its source, starting with the official bill record.