State Antifraud Authority
Chapters in this video
- 0:00 Core rule: state antifraud authority is absolute
- 1:00 Prospective waivers are void
- 2:19 NSMIA preemption and the antifraud preservation
- 3:30 Exchange-listed securities notice filing exception
- 4:08 Advisory antifraud: rendition of advice and solicitation
- 5:42 Principal trades require per-transaction consent
- 6:51 Agency cross allows advance consent
- 7:23 Rapid-fire exam recap
What this video covers
- Why state antifraud authority applies to federal covered securities, exempt securities, exempt transactions, and registered securities with zero exceptions
- How the National Securities Markets Improvement Act (NSMIA) preempts state registration but explicitly preserves state antifraud power
- Why a prospective waiver of antifraud protection is void and unenforceable, regardless of investor sophistication or accredited status
- The two-prong advisory antifraud provision: rendition of advice to existing clients and solicitation of prospects, even without a completed securities transaction
- The four prohibited acts under the rendition of advice prong that must be memorized for exam day
- Why principal trades require per-transaction written disclosure and informed consent, while agency cross transactions allow advance written consent
- The exchange-listed securities exception to state notice filing requirements, and why antifraud authority still applies
Read the full lesson, free
This video's complete written lesson is free to read in the CertFuel app, no signup wall. The complete Series 66 course also includes adaptive practice questions and spaced-repetition flashcards.