Kilkenny, Labrecque and Lane. The opinion of the court was delivered by Lane, J.A.D.
[116 NJSuper Page 173] Ridgway, McLeod & Associates appeals from an order of the Bureau of Securities suspending it from operating as a broker-dealer for 30 days. The bases of the suspension were: (1) appellant's failure to maintain the minimum net capital requirement, in violation of Bureau of Securities Regulation 13:13-3, and (2) appellant's attempt to sell its own securities in order to raise
funds to comply with the minimum net capital requirement, in violation of Regulation 13:13-40.
Regulation 13:13-3, "Minimum Capital," provides:
No registration as broker-dealer shall be issued unless the applicant therefor has a minimum capital of $10,000. or has posted with the Bureau of Securities a surety bond in the amount of $10,000.
No registration as a broker-dealer shall be issued to an applicant engaged exclusively in the sale of investment company shares unless the applicant therefor has a minimum capital of $5,000. or has posted with the Bureau of Securities a surety bond in the amount of $5,000.
No registration as a broker-dealer shall be issued to an applicant having custody of clients' funds or securities unless such applicant has a minimum capital of $25,000. or has posted with the Bureau of Securities a surety bond in the amount of $25,000.
Regulation 13:13-40, "Restriction," provides:
No person shall be permitted to issue, offer or sell securities in this State solely for the purpose of providing minimum capital requirements necessary in order to become registered as a broker-dealer.
Appellant admits that its capital fell below $10,000 during the time that it was operating as a broker-dealer. It further admits that it sold its own securities to customers for the purpose of complying with the minimum capital requirements.
The argument is advanced that Regulation 13:13-3 requires a minimum capital of $10,000 only at the time of registration and that it does not require the maintenance of such minimum capital during the period of registration. The regulation must be interpreted to manifest the intent of the Bureau of Securities. Language is not to be rigidly interpreted if it is apparent that such interpretation was not intended. Alexander v. New Jersey Power & Light Co. , 21 ...