State Regulation Updates

NASAA Model Rule on the Use of Senior-Specific Certifications and Professional Designations

The Model Rule, adopted by the NASAA membership on March 20, 2008, was enacted for the purpose of protecting seniors from the misleading use of credentials and designations “by any person in connection with the offer, sale, or purchase of securities, or the provision of advice as to the value of or the advisability of investing in, purchasing, or selling securities” that implies that the user has special training, expertise, or certification in advising senior citizens. Under the Model Rule, the misleading use of senior-specific certifications or designations shall be a dishonest and unethical practice in the “securities, commodities, investment, franchise, banking, finance, or insurance business”.

The Model Rule lists prohibited uses of professional designations and certifications, including the use of “a nonexistent or self-conferred” professional designation, the use of a designation that implies a level of qualification through education or training that the person does not have, and the use of a designation from a designating or certifying organization that “is primarily engaged in the business of instruction in sales and/or marketing” or “does not have reasonable continuing education requirements for its designees” in order to maintain the professional designation. Included is a rebuttable presumption that a designation or certification is not disqualified under the Model Rule when the certification has been accredited by a nationally recognized accrediting agency.

States that have adopted the NASAA Model Rule:

  • Alabama
  • Arkansas
  • California
  • Colorado
  • Delaware
  • District of Columbia
  • Florida
  • Illinois
  • Iowa
  • Kansas
  • Kentucky
  • Maine
  • Maryland
  • Massachusetts
  • Minnesota
  • Missouri
  • Montana
  • Nebraska
  • New Hampshire
  • New Jersey
  • New Mexico
  • North Carolina
  • Ohio
  • Oregon
  • South Dakota
  • Texas
  • Utah
  • Virginia
  • Washington
  • West Virginia
  • Wisconsin

States where regulation is currently pending:

  • Georgia