Summary Analysis Prepared by the Division of Securities
The Division currently has administrative rules in DFI-Sec 4.10 (1) to (4) entitled “Bank Agency Transactions." That series of rules sets forth the requirements to be met for a bank, savings institution or trust company (“bank") not to have to be licensed as a broker-dealer in Wisconsin in order to execute transactions involving various types of securities as an agent for public investor-purchasers or sellers of the securities.
Currently, when a bank sells its own certificates of deposit (“CDs") to purchasers, such does not trigger the Wisconsin securities broker-dealer licensing requirements. However, when a bank sells CDs of third-party financial institutions, such sales activities do not come within current Wisconsin statutory definitional exclusions or current administrative rules establishing exclusions from broker-dealer licensure for banks involved in effectuating securities transactions as agent for investors.
As a result, Wisconsin banks cannot engage in this activity, and Wisconsin investors cannot purchase at their “home" bank, the CDs of other financial institutions, unless and until an administrative rule with appropriate and necessary investor protections is enacted to enable those sales activities to take place. The proposed rules [which also involve a renumbering of current DFI-Sec 4.10 (1) to (4) to be DFI-Sec 4.10 (1) (a) to (d)] would create a new subsection (2) under existing Bank Agency Transactions rule s.
DFI-Sec 4.10 to deal separately with this situation where the type of security involved in the transaction effectuated by the bank is a certificate of deposit issued by a third-party financial institution. Because the scope of authority under ss.
551.02 (3) (c) and
551.31 (5), Stats., for rule-making on this subject is limited to sales activities by banks, savings institutions and trust companies (the entities specified under s.
551.22 (3), Stats.), the proposed rules cannot include savings and loan associations, savings banks or credit unions (which are entities separately listed under ss.
551.22 (4) and
(5), Stats.).
Because the CDs involved in such transactions under the proposed rules would be federally-insured certificates of deposit in amounts not exceeding the $100,000 per investor insurance levels under Federal Deposit Insurance Corporation provisions (such that there is no risk of loss of principal to an investor), the entirety of the existing rules under DFI-Sec 4.10 (1) to (4) is not made applicable. Rather, in addition to those parts of current rules s.
DFI-Sec 4.10 (1) to
(4) that will be utilized, the proposed rules include several of the specific requirements currently contained in existing administrative rule DFI-Sec 4.11 relating to sales to the public by securities broker-dealers of so-called “brokered certificates of deposit."
The components of the proposed rule include the following:
(1) Supervisory requirements to be met by the bank regarding persons involved in providing administrative services and executing the CD transactions, which requirements correspond to existing requirements in current rule s.
DFI-Sec 4.10 (1) (b) 2.
(2) Record-keeping requirements to be met by the bank relating to the CD transactions that correspond to existing requirements in current rule DFI-Sec 4.10(2).
(3) Disclosure requirements to be met--applicable to general advertising materials as well as materials used individually with investors--that are derived from current “brokered certificates of deposit" rule subsections in DFI-Sec 4.11 (1).
(4) The certificates of deposit involved in transactions under the rule may not exceed $100,000 per investor such that, due to the existence of FDIC deposit insurance up to that level, there is no risk of loss of principal to investors.
A copy of the proposed rules to be considered may be obtained upon request to the Division of Securities, Department of Financial Institutions, 345 West Washington Avenue, 4th Floor, P.O. Box 1768, Madison, Wisconsin 53701.
Fiscal Estimate
A summary of the fiscal effects of the proposed rule revisions is as follows: (i) No one-time revenue fluctuations or annual fiscal effects; (ii) No long-range fiscal implications; (iii) No fiscal effect on local units of government.
Initial Regulatory Flexibility Analysis
1. Types of small businesses that could be affected by certain of the rule revisions are:
Because the proposed rules are applicable only to banks, the standard small business considerations under 227.114 (1) (a), Stats., are not involved. Additionally, because all Wisconsin investors are entitled to the public investor protection benefits of the proposed rules, the rules do not differentiate in their applicability based on the size of the bank conducting the sales activities under the rules.
2. Reporting, bookkeeping and other procedures required for compliance with the rules.
Under par. (d) of proposed new DFI-Sec 4.10 (2), banks making sales of the CDs of third-party financial institutions pursuant to the rule are required to make and retain for a three (3) year period, a record of CD purchases made. The rule provides that such record-keeping requirements can be satisfied by keeping copies of purchase applications and customer checks, or copies of confirmations from the issuing financial institution.
Copies of Rule and Contact Person
A copy of the full text of the proposed rule revisions and fiscal estimate may be obtained from:
Randall E. Schumann (608) 266-3414
Legal Counsel for the Division of Securities
Department of Financial Institutions
345 West Washington Avenue, 4th Floor
P. O. Box 1768
Madison, WI 53701
Notice of Hearing
NOTICE IS HEREBY GIVEN that pursuant to authority vested in the Medical Examining Board in ss.
15.08 (5) (b),
227.11 (2) and
448.40 (1), Stats., and interpreting ss.
448.015 (4) and
448.02 (3), Stats., the Medical Examining Board will hold a public hearing at the time and place indicated below to consider an order to create s.
Med 10.02 (2) (zc), relating to defining failing to cooperate in a timely manner in an investigation as unprofessional conduct.
Hearing Date, Time and Location
Date: April 24, 2002
Time: 8:30 a.m.
Location: 1400 East Washington Avenue
Room 179A
Madison, Wisconsin
Appearances at the Hearing
Interested persons are invited to present information at the hearing. Persons appearing may make an oral presentation but are urged to submit facts, opinions and argument in writing as well. Facts, opinions and argument may also be submitted in writing without a personal appearance by mail addressed to the Department of Regulation and Licensing, Office of Administrative Rules, P.O. Box 8935, Madison, Wisconsin 53708. Written comments must be received by May 15, 2002 to be included in the record of rule-making proceedings.
Analysis prepared by the Department of Regulation and Licensing.
The Medical Examining Board wants to include as unprofessional conduct the failure of a credential holder to cooperate in a timely manner with an investigation. The board wants it to be unprofessional conduct on the part of the credential holder for failing to cooperate by providing information the board has requested in a pending investigation within 30 days and be able to charge that credential holder with unprofessional conduct for failing to cooperate. The board has attempted on several occasions to obtain information from a credential holder on a complaint the board has received which they wish to investigate further but need information from the credential holder.
Text of Rule
SECTION 1. Med 10.02 (2) (cz) is created to read:
Med 10.02 (2) (zc) After a request by the department, failing to cooperate in a timely manner with the department's investigation of a complaint filed against the credential holder. There is a rebuttable presumption that a credential holder who takes longer than 30 days to respond to a request of the department has not acted in a timely manner.
Fiscal Estimate
1. The anticipated fiscal effect on the fiscal liability and revenues of any local unit of government of the proposed rule is: $0.00.
2. The projected anticipated state fiscal effect during the current biennium of the proposed rule is: $0.00.
3. The projected net annualized fiscal impact on state funds of the proposed rule is: $0.00.
Initial Regulatory Flexibility Analysis
These proposed rules will be reviewed by the department through its Small Business Review Advisory Committee to determine whether there will be an economic impact on a substantial number of small businesses, as defined in s.
227.114 (1) (a), Stats.
Copies of Rule and Contact Person
Copies of this proposed rule are available without cost upon request to: Pamela Haack, Department of Regulation and Licensing, Office of Administrative Rules, 1400 East Washington Avenue, Room 171, P.O. Box 8935, Madison, Wisconsin 53708 (608) 266-0495.
Notice of Hearing
NOTICE IS HEREBY GIVEN that pursuant to s.
977.02 (4m) Stats., and interpreting s.
977.075 (1) Stats., the Office of the State Public Defender will hold a public hearing at 315 North Henry Street, 2
nd Floor, in the city of Madison, Wisconsin, on the
1st day of April 2002, from 9:00 a.m. to 11:00 a.m. to consider the amendment of s.
PD 6.02, related to the repayment of cost of legal representation. Reasonable accommodations will be made at the hearing for persons with disabilities.
Analysis prepared by the Wisconsin State Public Defender
Section
977.075 requires that the state public defender board establish by rule a program for repayment of the cost of legal representation. Section
977.075 (1) requires that the state public defender board establish by rule fixed amounts as flat payments for the cost of representation that a person may elect to pay. Section
PD 6.02 (1) is the original rule that was promulgated as required by s.
977.075 (1). The rule provides a flat payment schedule for persons electing to pay within 30 days of the appointment of counsel.
The state public defender board authorized a pilot project beginning in April 1998 in the 14 counties listed below. This project provided 60 days, instead of 30, to pay the lower prepayment amount as satisfaction of the payment obligation.
Adams Forest Langlade Oneida
Price Waupaca Vilas Florence
Kenosha Marathon Portage Taylor Wood Lincoln
The board authorized the expansion of the project to include Milwaukee in January 2000. Based on 24 months of data, the number of prepayments increased about 2.6% annually in Milwaukee. The 14 counties in the project outside of Milwaukee experienced a 3.3% increase in prepayments.
The proposed rule would amend s.
PD 6.02 (1) to provide a 60-day flat payment option for all counties. It is anticipated that such a rule would result in similar increases in payments in the additional counties.
Fiscal Estimate
It is anticipated that expanding the 60 day prepayment option statewide will increase revenues annually approximately $110,000. Copies of the full fiscal estimates are freely available from the contact person.
Initial Regulatory Flexibility Analysis
The proposed amendment would not have a regulatory effect on small businesses.
Copies of Rule and Contact Person
For copies of the proposed amendment to the rule, or if you have questions, please contact Deborah Smith, Legal Counsel, 315 North Henry Street, Madison, WI 53703-3018; (608) 261-8856.
Written Comments
Written comments regarding this rule may be submitted in addition to or instead of verbal testimony at the public hearing. Such comments should be addressed to the contact person at the address stated above, and must be received by April 1, 2002.
Notice of Hearing
NOTICE IS HEREBY GIVEN That pursuant to s.
227.11 (2) (a), Stats., and interpreting s.
119.23, Stats., the Department of Public Instruction will hold a public hearing as follows to consider emergency and proposed permanent rules, relating to Milwaukee parental choice program. These rules were promulgated as emergency rules effective January 28, 2002. The hearing will be held as follows:
Hearing Date, Time and Location
April 9, 2002 Milwaukee
4:00 - 6:00 p.m. Milwaukee Technical College
700 West State Street
Room M616
The hearing site is fully accessible to people with disabilities. If you require reasonable accommodation to access any meeting, please call Bob Soldner at (608) 266-7475 or leave a message with the Teletypewriter (TTY) at (608) 267-2427 at least 10 days prior to the hearing date. Reasonable accommodation includes materials prepared in an alternative format, as provided under the Americans with Disabilities Act.
Copies of Rule and Contact Person
Lori Slauson, Administrative Rules and Federal Grants Coordinator
Department of Public Instruction
125 South Webster Street
