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Regulation and Compliance > State Regulation > NASAA

NASAA to Allow 5-Year Breaks for Brokers, IARs

By Melanie Waddell

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What You Need to Know

  • A new program, called EVEP, allows industry professionals to maintain state qualification exams for up to five years if they keep up with CE requirements.
  • Not all states have adopted the program; participants who leave must reenter in a participating state.
  • The Series 65 passing score was updated on June 12; Series 65 EVEP enrollments will begin later this year.

The North American Securities Administrators Association said Wednesday that it has launched an Exam Validity Extension Program to allow eligible individuals to leave the industry for up to five years and maintain their Series 63 license, and is planning a similar extension for the Series 65.

The EVEP allows industry professionals “to maintain their state qualification exams for up to five years if they maintain compliance with their continuing education requirements and industry knowledge,” NASAA President Andrew Hartnett said Wednesday in a statement.

The program, Hartnett said, “is designed to provide flexibility for currently registered persons who, due to various reasons, may need to leave and then return to the industry.”

In April, NASAA adopted a new rule allowing states to permit investment advisor representatives to leave the securities industry for up to five years as long as they maintained their exam qualifications and completed certain annual continuing ed requirements.

In September 2022, NASAA adopted a broker-dealer exam validity model rule.

The BD and IAR model rule packages “provided a regulatory structure by which states could permit exam validity extensions,” NASAA told ThinkAdvisor Wednesday. “But then we had to actually implement a program to accomplish this. That’s what we’ve just completed; today’s announcement means Broker-Dealer agents and IARs can actually begin signing-up for EVEP and taking advantage of the NASAA model rules in those states that have adopted them.”

IARs, however, “still have to wait a bit; the EVEP program for them isn’t up and running just yet,” NASAA added.

EVEP Program Details

Eligible individuals may enroll in the EVEP through their Financial Professional Gateway (FinPro) account to extend their Series 63 exam validity for up to five years, and pay a $35 annual fee  while maintaining CE requirements.

While all eligible individuals can enroll in the program, the program “will only be recognized when an individual reenters the industry and registers in states that have adopted the program,” NASAA explained. Only Minnesota has adopted the rule for BDs; several states are currently in the adoption process for BDs, IARs or both, NASAA says.

NASAA is also developing a similar program for investment adviser representatives to extend their NASAA qualification exam (IAR EVEP), the Series 65, with enrollments beginning later this year, the group said.

“To extend both parts of the Series 66 exam, an individual must enroll in both programs, AG EVEP and IAR EVEP, to extend both Series 63 and Series 65 Credits, if applicable,” NASAA said.

Series 65 Passing Score

Meanwhile, the Series 65 passing score was updated on June 12 “in response to a job analysis project that was performed last year,” Jennifer Lerner, Regulatory Services Specialist at NASAA, told ThinkAdvisor. “Candidates must now answer 92 out of 130 questions correct to earn a passing score.”

The passing score, Lerner stated, “is 92 out of 130 and not simply a 70%,” as explained in NASAA’s Exam FAQ:

Why did I receive a “fail” on my Series 65 exam even though I scored a 70%?

The passing grade for the Series 65 exam is not 70% and is not calculated as a percentage.  Candidates must answer 92 out of 130 questions correct to earn a passing grade on the Series 65 exam. 

Melanie Waddell

@Think_MelanieW

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