Md. Code Regs. 02.02.05.20

Current through Register Vol. 51, No. 12, June 14, 2024

Section 02.02.05.20 - Exemption from the Maryland Securities Act, Corporations and Associations Article, Section11-101(i)(2), Annotated Code of Maryland, for Certain Individuals

Under the Maryland Securities Act, Corporations and Associations Article, § 11-101(i)(2), Annotated Code of Maryland, an investment adviser representative does not include:

A. An individual broker-dealer agent who:

(1) In conjunction with the agent's employment or affiliation with a broker-dealer, holds out to the public, as set forth in the Maryland Securities Act, Corporations and Associations Article, § 11-101(h)(1)(ii) 3, Annotated Code of Maryland, by use of the title "financial consultant", "financial adviser", or similar title or designation;

(2) Does not in any other manner hold out as an investment adviser or representative;

(3) Does not in any other manner act or perform as an investment adviser or representative as set forth in the Maryland Securities Act, Corporations and Associations Article, § 11-101(h)(1), Annotated Code of Maryland;

(4) Is registered and in good standing in this State as the agent of a broker-dealer that is registered and in good standing in this State; and

(5) Has passed, with a score of 70 percent or better, the Series 7 examination administered by the FINRA, or a combination of examinations that the Commissioner determines is the substantial equivalent of the Series 7 examination;

B. An individual insurance producer who:

(1) Falls within the definition of "investment adviser" under the Maryland Securities Act, Corporations and Associations Article, § 11-101(h)(1), Annotated Code of Maryland, solely by incident of holding out to the public, as set forth in the Maryland Securities Act, Corporations and Associations Article, § 11-101(h)(1)(ii) 3, Annotated Code of Maryland, by use of the registered trademark "ChFC", "Chartered Financial Consultant", "NAIFA", "National Association of Insurance and Financial Advisers", or any state or local affiliate of NAIFA whether by name or acronym, in the context of representing, acting as an agent or employee of, or otherwise indicating an affiliation with, an insurance company, producer, or agency;

(2) Does not in any other manner hold out as an investment adviser or representative;

(4) Holds a valid license as an insurance producer with the Maryland Insurance Administration, as provided in the Insurance Article, Annotated Code of Maryland; and

(5) Does not, in any other manner, act or perform as a broker-dealer agent as set forth in the Maryland Securities Act, Corporations and Associations Article, § 11-101(b), Annotated Code of Maryland;

C. An individual officer, director, or other administrative employee of an insurance company, producer, agency, or trade association who:

(1) Falls within the definition of "investment adviser" under the Maryland Securities Act, Corporations and Associations Article, § 11-101(h)(1), Annotated Code of Maryland, solely by incident of holding out to the public, as set forth in the Maryland Securities Act, Corporations and Associations Article, § 11-101(h)(1)(ii)(3), Annotated Code of Maryland, by use of the registered trademark "ChFC", "Chartered Financial Consultant", "NAIFA", "National Association of Insurance and Financial Advisers", or any state or local affiliate of NAIFA whether by name or acronym;

(2) Does not in any other manner hold out as an investment adviser or representative;

(4) Is regulated by the Maryland Insurance Administration, as provided in the Insurance Article, Annotated Code of Maryland, with respect to business or professional conduct;

(5) Uses the registered trademark "ChFC", "Chartered Financial Consultant", "NAIFA", "National Association of Insurance and Financial Advisers", or any state or local affiliate of NAIFA whether by name or acronym, only in the context of acting as an officer, director, or other administrative employee of an insurance company, producer, agency, or trade association; and

(6) Does not, in any other manner, act or perform as a broker-dealer agent as set forth in the Maryland Securities Act, Corporations and Associations Article, § 11-101(b), Annotated Code of Maryland;

D. An individual who falls within the definition of "investment adviser" under the Maryland Securities Act, Corporations and Associations Article, § 11-101(h)(1), Annotated Code of Maryland, solely by incident of holding out to the public, as set forth in the Maryland Securities Act, Corporations and Associations Article, § 11-101(h)(1)(ii) 3, Annotated Code of Maryland, but who:

(1) Uses the registered trademark "ChFC", "Chartered Financial Consultant", "CFP", or "Certified Financial Planner" solely in the context of:

(a) Acting as a teacher or researcher at an accredited college or university,

(b) Employment in the employee benefits, pension, personnel, or similar unit of a business entity that is not an investment adviser, or

(c) Employment by an agency of municipal, state, or local government;

(2) Does not in any other manner hold out as an investment adviser or representative; and

Md. Code Regs. 02.02.05.20

Regulations .20 adopted as an emergency provision effective October 1, 1992 (19:17 Md. R. 1602); emergency status extended at 19:24 Md. R. 2123; adopted permanently effective December 7, 1992 (19:24 Md. R. 2125)