Just got another great question, this one from a customer studying for his Series 63. Don't worry--the Series 63 exists on both the Series 65 and (moreso) on the Series 66 exams. The customer asked:
Can a broker-dealer be a natural person?
The question is really asking if a broker-dealer could be set up as a sole proprietor.
The answer is--yes he could. A sole proprietor does business as himself, so he is a natural person--there is no LLC or corporate structure set up as a separate legal entity from himself.
An investment adviser could also be set up as a sole proprietor, which means he/she is a natural person doing business as him or herself. Usually, a broker-dealer or adviser would set up an LLC or corporation. When they do that, they end up with a separate legal entity/person apart from the human beings who run the business.
On the other hand, agents and IARs are always natural persons--they are employees who represent the broker-dealer or the adviser. Period.
Broker-dealers and RIAs can be natural persons, but are usually "legal persons" in the form of a corporation or LLC.
Why the exam would even go into this weird territory . . . no idea. It's NASAA's world. We just try to live in it.