The Massachusetts Senior
Frequently Asked Questions and Answers*
Q. When do the Massachusetts “Senior Designations” regulations become effective?
A. The regulations on the use of senior designations became effective June 1, 2007.
Q. Has the Massachusetts Securities Division recognized any accreditation organizations that may accredit senior designations, as called for in 950 CMR 12.204(2)(i) and 12.205(9)(c)(15)?
A. Yes. The Secretary may recognize accreditation organizations by rule or order. A list of accredited organizations that the Secretary has recognized may be found on the Massachusetts Securities Division’s website.
Q. Does the Massachusetts Securities Division maintain a list of credentials or designations that have been accredited?
A. No. Interested persons should check with the sponsor of the credential or designation to determine whether the particular credential or designation has been accredited. In addition, the accreditation organizations recognized by the Secretary thus far maintain lists of credentialing programs that they have accredited.
Q. Are there grace periods built into the regulation?
A. Yes. There is an initial two month grace period (until August 1, 2007) for all credentials and designations. In addition, a six month grace period (and the potential for additional, discretionary grace periods, as provided by the regulation) is triggered when an application for accreditation has been filed with an accreditation organization recognized by the Secretary.
Q. For purposes of Subsections 12.204(2)(i) and 12.205(9)(c)(15), what constitutes an “application” to the National Commission for Certifying Agencies?
A. The Massachusetts Securities Division has been informed by personnel at the National Commission for Certifying Agencies (“NCCA”) that an application for accreditation by NCCA must be complete upon submission. This differs from the American National Standards Institute, which has an application process that allows an initial application to be submitted, and the bulk of the application materials to be submitted following the initial application. NCCA accepts applications three times a year, in January, April and September. The Division has agreed that an “application” to NCCA under Sections 12.204(2)(i) and 12.205(9)(c)(15) may be a letter of intent indicating that the full application will be submitted at the next NCCA application deadline, as long as the application is actually submitted within 90 days after the letter of intent. A letter of intent indicating that the full application materials will be submitted in the indefinite future would not constitute an application under the regulations. Similarly, a letter of intent indicating that an application would be submitted by a date certain would likely not constitute an application if the application is not actually submitted by that date.
Q. How does the new regulation apply to degrees or certificates evidencing completion of an academic program at an accredited institutions of higher education?
A. Subsections 12.204(2)(i) and 12.205(9)(c)(15) shall not apply to a degree or certificate evidencing completion of an academic program at an accredited institution of higher education, unless the facts and circumstances associated with the provision or use of such degree or certificate indicate that it improperly suggests or implies certification or training beyond that which the degree holder or certificate holder possesses or that it otherwise misleads investors.
For the purposes of subsections 12.204(2)(i) and 12.205(9)(c)(15), “accredited institution of higher education” means any institution of higher education that is on the United States Department of Education’s list titled “Accrediting Agencies Recognized for Title IV Purposes, ” which is a list of accrediting agencies whose accreditation enables institutions to establish eligibility to participate in the federal student financial assistance programs administered by the Department of Education under Title IV of the Higher Education Act of 1965, as amended.
Please note that accreditation organizations that accredit institutions of higher education, referenced in the reference to “accredited institution of higher education” under these exemptions 12.204(2)(i)(4) and 12.205(9)(c)(15)(d), are different from the accreditation organizations referred to in subsections 12.204(2)(i)(1) and 12.205(9)(c)(15)(a), such as the American National Standards Institute and the National Commission Certifying Agencies, which accredit credentials and professional designations.
The Division notes that the “facts and circumstances” requirement included in these subsections 12.204(2)(i)(4) and 12.205(9)(c)(15)(d) is similar to the requirements of NASD Conduct Rule 2210 and IM-2210-1, which require that brokerage firms and their representatives must ensure that statements to customers are not misleading within the context in which they are made.
*The information provided herein is for general guidance to the public, but should not be considered to be legal advice or a definitive interpretation of the law.