AB150,2178,86
551.32
(5) The
commissioner department may by rule require a minimum
7capital for broker-dealers and investment advisers and establish limitations on
8aggregate indebtedness of broker-dealers in relation to net capital.
AB150, s. 6700
9Section
6700. 551.32 (6) of the statutes is amended to read:
AB150,2178,1410
551.32
(6) The
commissioner department may by rule require the furnishing
11of surety bonds by broker-dealers and investment advisers and all bonds so required
12shall provide for suit thereon by injured customers or clients, but no bond may be
13required of any licensee whose net capital exceeds the amount prescribed by rule for
14this purpose.
AB150, s. 6701
15Section
6701. 551.32 (7) of the statutes is amended to read:
AB150,2178,1916
551.32
(7) The
commissioner department may by rule or order impose other
17conditions or limitations in connection with the issuance of licenses under this
18chapter as the
commissioner department deems appropriate in the public interest
19or for the protection of investors.
AB150, s. 6702
20Section
6702. 551.33 (1) of the statutes is amended to read:
AB150,2179,321
551.33
(1) Every licensed broker-dealer, agent and investment adviser shall
22make and keep all accounts, correspondence, memoranda, papers, books and other
23records which the
commissioner department by rule prescribes. All records required
24shall be preserved for 3 years unless the
commissioner
department by rule prescribes
25otherwise for particular types of records. All required records shall be kept within
1this state or shall, at the request of the
commissioner department, be made available
2at any time for examination by the
commissioner department either in the principal
3office of the licensee or by production of exact copies thereof in this state.
AB150, s. 6703
4Section
6703. 551.33 (2) of the statutes is amended to read:
AB150,2179,65
551.33
(2) Every licensed broker-dealer and investment adviser shall file such
6reports as the
commissioner department by rule prescribes.
AB150, s. 6704
7Section
6704. 551.33 (3) of the statutes is amended to read:
AB150,2179,118
551.33
(3) If the information contained in any application for license or other
9document filed with the
commissioner department or an organization designated
10under s. 551.32 (1) (a) is or becomes inaccurate or incomplete in any material respect,
11the licensee shall promptly file a correcting amendment.
AB150, s. 6705
12Section
6705. 551.33 (4) of the statutes is amended to read:
AB150,2180,513
551.33
(4) The
commissioner department shall make periodic examinations,
14within or without this state, of the business and records of each licensed
15broker-dealer and investment adviser, at such times and in such scope as the
16commissioner department determines. The examinations may be made without
17prior notice to the broker-dealer or investment adviser. The expense reasonably
18attributable to any such examination shall be paid by the broker-dealer or
19investment adviser whose business is examined, but the expense so payable shall not
20exceed an amount which the
commissioner department by rule prescribes. For the
21purpose of avoiding unnecessary duplication of examinations, the
commissioner 22department, insofar as it is practicable in administering this subsection, may
23cooperate with securities administrators of other states, the securities and exchange
24commission, and any national securities exchange or national securities association
25registered under the securities exchange act of 1934. The
commissioner department
1shall not make public the information obtained in the course of examinations, except
2when the
commissioner's department's duty under this chapter requires the
3commissioner department to take action regarding any broker-dealer or investment
4adviser or to make the information available to one of the organizations specified in
5this subsection, or except when called as a witness in any criminal or civil proceeding.
AB150, s. 6706
6Section
6706. 551.33 (5) of the statutes is amended to read:
AB150,2180,97
551.33
(5) The
commissioner department may by rule prohibit unreasonable
8charges, profits, commissions or other compensation of broker-dealers and
9investment advisers.
AB150, s. 6707
10Section
6707. 551.33 (6) of the statutes is amended to read:
AB150,2180,1311
551.33
(6) The
commissioner department may by rule establish standards for
12the conduct of business by broker-dealers, agents, investment advisers and clearing
13corporations as defined in s. 408.102 (1) (c).
AB150, s. 6708
14Section
6708. 551.34 (1) (intro.) of the statutes is amended to read:
AB150,2180,2115
551.34
(1) (intro.) The
commissioner
department may by order deny an
16application for, or postpone the effective date of, a license or suspend or revoke any
17license or may censure the licensee, if the
commissioner department finds that the
18order is in the public interest and that the applicant or licensee or, in the case of a
19broker-dealer or investment adviser, any partner, officer or director, any person
20occupying a similar status or performing similar functions, or any person directly or
21indirectly controlling the broker-dealer or investment adviser:
AB150, s. 6709
22Section
6709. 551.34 (1) (e) of the statutes is amended to read:
AB150,2180,2523
551.34
(1) (e) Is the subject of an order of the
commissioner department 24denying an application or suspending or revoking a license as a broker-dealer, agent
25or investment adviser;
AB150, s. 6710
1Section
6710. 551.34 (1) (f) of the statutes is amended to read:
AB150,2181,152
551.34
(1) (f) Is the subject of an order entered within the past 5 years by the
3securities administrator of any other state or by the securities and exchange
4commission denying, suspending or revoking the person's registration or license as
5a broker-dealer, agent or investment adviser, or is the subject of an order of the
6securities and exchange commission or of a securities exchange or association
7registered under the securities exchange act of 1934 suspending or expelling such
8person from a securities exchange or association or forbidding the association or
9affiliation of the person with a broker-dealer or investment adviser, or is the subject
10of a U.S. postal service fraud order. The
commissioner department may not institute
11a revocation or suspension proceeding under this paragraph more than one year from
12the date of the order relied on, and the
commissioner
department may not enter an
13order under this paragraph on the basis of an order under another state law or
14federal law unless the order was based on facts which would currently constitute a
15ground for an order under this section;
AB150, s. 6711
16Section
6711. 551.34 (1) (k) of the statutes is amended to read:
AB150,2181,1817
551.34
(1) (k) Has failed to pay the proper filing fee, but the
commissioner 18department shall vacate any such order when the deficiency has been corrected;
AB150, s. 6712
19Section
6712. 551.34 (1) (m) of the statutes is amended to read:
AB150,2181,2320
551.34
(1) (m) Has made any material misrepresentation to or withheld or
21concealed any material fact from the
commissioner or any of his or her
22representatives department, or has refused to furnish information reasonably
23requested by the
commissioner department; or
AB150, s. 6713
24Section
6713. 551.34 (2) of the statutes is amended to read:
AB150,2182,5
1551.34
(2) The enumeration of the causes stated in sub. (1) shall not be
2exclusive and the
commissioner department may deny an application or suspend or
3revoke any license or censure any licensee for any cause whether similar to or
4different from these causes when necessary or appropriate in the public interest or
5for the protection of investors.
AB150, s. 6714
6Section
6714. 551.34 (3) of the statutes is amended to read:
AB150,2182,107
551.34
(3) The
commissioner department may not institute a suspension or
8revocation proceeding on the basis of a fact or transaction known to the
commissioner 9department when the license was issued unless the proceeding is instituted within
10180 days following issuance of the license.
AB150, s. 6715
11Section
6715. 551.34 (4) of the statutes is amended to read:
AB150,2182,1612
551.34
(4) If the public interest or the protection of investors so requires, the
13commissioner department may by order summarily deny or suspend a license or
14postpone the effective date of a license. Upon the entry of the order, the
commissioner 15department shall serve upon all named parties a copy of the order and notify the
16parties of their right to request a hearing.
AB150, s. 6716
17Section
6716. 551.34 (5) of the statutes is amended to read:
AB150,2182,2318
551.34
(5) If the
commissioner department finds that any licensee or applicant
19is no longer in existence or has ceased to do business as a broker-dealer, agent or
20investment adviser, or is subject to an adjudication of mental incompetence or to the
21control of a committee, conservator or guardian, or cannot be located after reasonable
22search, the
commissioner department may on order issued summarily revoke the
23license or deny the application.
AB150, s. 6717
24Section
6717. 551.34 (6) of the statutes is amended to read:
AB150,2183,15
1551.34
(6) Withdrawal from the status of a licensed broker-dealer, agent or
2investment adviser becomes effective 30 days after receipt by the
commissioner 3department or by an organization designated by rule of the
commissioner 4department under s. 551.32 (1) (a) of an application to withdraw or within such
5shorter period as the
commissioner department determines, unless a revocation or
6suspension proceeding is pending when the application is filed or a proceeding to
7revoke or suspend or to impose conditions upon the withdrawal is instituted within
830 days after the application is filed. If a proceeding is pending or instituted,
9withdrawal becomes effective at such time and upon such conditions as the
10commissioner department by order determines. If no proceeding is pending or
11instituted and withdrawal automatically becomes effective, the
commissioner 12department may institute a revocation or suspension proceeding for the grounds
13specified under sub. (1) (b), (g), (m) or (n) within one year after withdrawal became
14effective and enter a revocation or suspension order as of the last date on which the
15license was in effect.
AB150, s. 6718
16Section
6718. 551.43 of the statutes is amended to read:
AB150,2183,21
17551.43 Broker-dealer activities. It is unlawful for a broker-dealer to effect
18in this state any transaction in, or to induce the purchase or sale of, any security by
19means of any manipulative, deceptive or other fraudulent device or contrivance,
20including any fictitious quotation. The
commissioner
department may by rule define
21the terms "manipulative, deceptive or other fraudulent device or contrivance".
AB150, s. 6719
22Section
6719. 551.44 of the statutes is amended to read:
AB150,2184,6
23551.44 Advisory activities. It is unlawful for any person who receives any
24consideration from another person primarily for advising the other person as to the
25value of securities or their purchase or sale, whether through the issuance of
1analyses or reports or otherwise, in this state, to employ any device, scheme or
2artifice to defraud the other person; or engage in any act, practice or course of
3business which operates or would operate as a fraud or deceit upon the other person;
4or take or have custody of any securities or funds of any client unless the adviser is
5licensed as a broker-dealer under this chapter. The
commissioner department may
6adopt rules defining the terms used in this section.
AB150, s. 6720
7Section
6720. 551.51 (1) of the statutes is amended to read:
AB150,2184,128
551.51
(1) This chapter shall be administered by the
commissioner of
9securities. The commissioner shall appoint a deputy commissioner, subject to s.
1015.04 (2) and (3). The commissioner may designate the deputy commissioner or any
11employe to perform any duty or exercise any power or function assigned to the
12commissioner when he or she is absent from the office department.
AB150, s. 6721
13Section
6721. 551.51 (2) of the statutes is amended to read:
AB150,2185,214
551.51
(2) It is unlawful for the
commissioner department or any officers or
15employes of the
office of the commissioner department to use for personal benefit any
16information which is filed with or obtained by the
commissioner department or an
17organization designated under s. 551.32 (1) (a) and which is not generally available
18to the public. Nothing in this chapter authorizes the
commissioner department or
19any officers or employes of the
office of the commissioner department to disclose any
20confidential information except among themselves or to other securities
21administrators or regulatory authorities or when necessary or appropriate in a
22proceeding or investigation under this chapter. No provision of this chapter either
23creates or derogates from any privilege which exists at common law or otherwise
24when documentary or other evidence is sought under a subpoena directed to the
1commissioner department or any officers or employes of the
office of the
2commissioner department.
AB150, s. 6722
3Section
6722. 551.52 (1) (b) (intro.) of the statutes is amended to read:
AB150,2185,114
551.52
(1) (b) (intro.) An indefinite amount of securities shall be registered
5under a registration statement relating to redeemable securities issued by an
6open-end management company or a face amount certificate company, as defined in
7the investment company act of 1940, and the applicant shall pay the fee under par.
8(a). The registrant also shall, within 60 days after the end of each fiscal year during
9which its registration statement is effective and within 60 days after the registration
10is terminated, file a report on a form prescribed by rule of the
commissioner 11department in which the registrant does any of the following:
AB150, s. 6723
12Section
6723. 551.52 (3) of the statutes is amended to read:
AB150,2185,1613
551.52
(3) The expenses reasonably attributable to the examination of any
14matter arising under this chapter shall be charged to the applicant, registrant or
15licensee involved, but the expenses so charged shall not exceed such maximum
16amounts as the
commissioner department by rule prescribes.
AB150, s. 6724
17Section
6724. 551.52 (4) of the statutes is amended to read:
AB150,2185,2118
551.52
(4) The
commissioner department may by rule require the payment of
19prescribed fees for delinquent or materially deficient filings of information or
20documents required under this chapter to be filed with the
commissioner department 21or an organization designated under s. 551.32 (1) (a).
AB150, s. 6725
22Section
6725. 551.53 (1) (b) of the statutes is amended to read:
AB150,2185,2523
551.53
(1) (b) That has not been filed with the
commissioner department not
24later than the date of publication or circulation, except as the
commissioner 25department may otherwise provide by rule or order.
AB150, s. 6726
1Section
6726. 551.53 (2) of the statutes is amended to read:
AB150,2186,32
551.53
(2) The
commissioner department may by rule or order prohibit the
3publication, circulation or use of any advertising deemed false or misleading.
AB150, s. 6727
4Section
6727. 551.54 of the statutes is amended to read:
AB150,2186,12
5551.54 Misleading filings. It is unlawful for any person to make or cause to
6be made, in any document filed with the
commissioner
department or filed under s.
7551.32 (1) (a) with an organization designated by the
commissioner department or
8in any proceeding under this chapter, any statement which is, at the time and in the
9light of the circumstances under which it is made, false or misleading in any material
10respect or, in connection with such statement, to omit to state a material fact
11necessary in order to make the statements made, in the light of the circumstances
12under which they are made, not misleading.
AB150, s. 6728
13Section
6728. 551.55 of the statutes is amended to read:
AB150,2186,23
14551.55 Unlawful representations. Neither the fact that a registration
15statement or an application for a license has been filed nor the fact that a security
16is effectively registered or a person is licensed constitutes a finding by the
17commissioner department that any document filed under this chapter is true,
18complete and not misleading. Neither any such fact nor the fact that an exemption
19or exception is available for a security or a transaction means that the
commissioner 20department has passed in any way upon the merits or qualifications of, or
21recommended or given approval to, any person, security or transaction. It is
22unlawful to make, or cause to be made, to any prospective purchaser, customer or
23client any representation inconsistent with the foregoing.
AB150, s. 6729
24Section
6729. 551.56 (1) (intro.) of the statutes is amended to read:
AB150,2186,2525
551.56
(1) (intro.) The
commissioner
department may:
AB150, s. 6730
1Section
6730. 551.56 (1) (b) of the statutes is amended to read:
AB150,2187,42
551.56
(1) (b) Require or permit any person to file a statement in writing, under
3oath or otherwise as the
commissioner department determines, as to all the facts and
4circumstances concerning the matter being investigated;
AB150, s. 6731
5Section
6731. 551.56 (2) of the statutes is amended to read:
AB150,2187,136
551.56
(2) For the purpose of any investigation, hearing or proceeding under
7this chapter, the
commissioner department or any officer designated by the
8commissioner department may administer oaths and affirmations, subpoena
9witnesses, compel their attendance, take evidence and require the production of any
10books, papers, correspondence, memoranda, agreements or other documents or
11records which the
commissioner department deems relevant or material to the
12inquiry. Failure to obey a subpoena or give evidence may be dealt with in accordance
13with s. 885.12.
AB150, s. 6732
14Section
6732. 551.56 (3) (a) of the statutes is amended to read:
AB150,2187,2515
551.56
(3) (a) No person is excused from attending and testifying or from
16producing any document or record before the
commissioner department, or in
17obedience to the subpoena of the
commissioner department or any officer designated
18by the
commissioner department, or in any proceeding instituted by the
19commissioner department, on the ground that the testimony or evidence required of
20the person may tend to incriminate him or her or subject the person to a penalty or
21forfeiture; but no individual may be prosecuted or subjected to any penalty or
22forfeiture for or on account of his or her testimony or evidence, after claiming his or
23her privilege against self-incrimination, except that the individual testifying is not
24exempt from prosecution and punishment for perjury or contempt committed in
25testifying.
AB150, s. 6733
1Section
6733. 551.57 of the statutes is amended to read:
AB150,2188,13
2551.57 Injunctions. Whenever it appears to the
commissioner department 3that any person has engaged or is about to engage in any act or practice constituting
4a violation of this chapter or any rule or order hereunder, the
commissioner 5department may bring an action in the name of the state in the circuit court of the
6appropriate county to enjoin the acts or practices and to enforce compliance with this
7chapter or any rule or order hereunder, or the
commissioner department may refer
8the matter to the attorney general or the district attorney of the appropriate county.
9Upon a proper showing, the court may grant a permanent or temporary injunction
10or restraining order, or may appoint a receiver for the defendant or the defendant's
11assets, or may order rescission of any sales or purchases of securities determined to
12be unlawful under this chapter or any rule or order hereunder. The court may not
13require the
commissioner department to post a bond.
AB150, s. 6734
14Section
6734. 551.58 (2) of the statutes is amended to read:
AB150,2188,2115
551.58
(2) The
commissioner department may refer such evidence as is
16available concerning violations of this chapter or of any rule or order under this
17chapter to the attorney general or the district attorney of the appropriate county, who
18may, with or without any reference, institute the appropriate criminal proceedings
19under this chapter. If referred to a district attorney, the district attorney shall,
20within 90 days, file with the
commissioner department a statement concerning any
21action taken or, if no action has been taken, the reasons therefor.
AB150, s. 6735
22Section
6735. 551.59 (6) (a) of the statutes is amended to read:
AB150,2189,1023
551.59
(6) (a) No purchaser may commence an action under this section if,
24before suit is commenced, the purchaser has received a written offer stating the
25respect in which liability under this section may have arisen and fairly advising the
1purchaser of his or her rights; offering to repurchase the security for cash payable
2on delivery of the security equal to the consideration paid, together with interest at
3the legal rate under s. 138.04 from the date of payment, less the amount of any
4income received thereon or, if the purchaser no longer owns the security, offering to
5pay the purchaser upon acceptance of the offer an amount in cash equal to the
6damages computed in accordance with sub. (1); and stating that the offer may be
7accepted by the purchaser at any time within a specified period of not less than 30
8days after the date of receipt thereof or such shorter period as the
commissioner 9department may by rule prescribe; and the purchaser has failed to accept such offer
10in writing within the specified period.
AB150, s. 6736
11Section
6736. 551.59 (6) (c) of the statutes is amended to read:
AB150,2189,1712
551.59
(6) (c) Offers shall be in the form and contain the information the
13commissioner department by rule prescribes. Every offer under this subsection shall
14be delivered to the offeree or sent by certified mail addressed to the offeree at the
15offeree's last-known address. If an offer is not performed in accordance with its
16terms, suit by the offeree under this section shall be permitted without regard to this
17subsection.
AB150, s. 6737
18Section
6737. 551.60 (title) of the statutes is amended to read:
AB150,2189,19
19551.60 (title)
Miscellaneous powers of commissioner.
AB150, s. 6738
20Section
6738. 551.60 (1) of the statutes is amended to read:
AB150,2189,2521
551.60
(1) The
commissioner department may by rule or order require any
22issuer of securities registered or exempted by order of the
commissioner department 23under this chapter or predecessor laws to file with the
commissioner department and
24distribute to its security holders in this state at least annually specified financial or
25other information concerning the issuer.
AB150, s. 6739
1Section
6739. 551.60 (2) (a) of the statutes is amended to read:
AB150,2190,62
551.60
(2) (a) If the
commissioner
department has reason to believe that any
3offer or sale of an unregistered security is, has been or would be unfair, inequitable
4or fraudulent to offerees or purchasers, the
commissioner department may by order
5summarily prohibit further offers or sales of such security in this state until it is
6registered under this chapter.
AB150, s. 6740
7Section
6740. 551.60 (2) (b) of the statutes is amended to read:
AB150,2190,128
551.60
(2) (b) If the
commissioner
department has reason to believe that any
9security is being or has been offered or sold in this state by any unlicensed person in
10violation of this chapter or any rule or order hereunder, the
commissioner 11department may by order summarily prohibit such person from further offers or
12sales of securities in this state until licensed under this chapter.
AB150, s. 6741
13Section
6741. 551.60 (2) (c) of the statutes is amended to read:
AB150,2190,1914
551.60
(2) (c) If the
commissioner
department has reason to believe that any
15unlicensed person is transacting or has transacted business in this state as an
16investment adviser in violation of this chapter or any rule or order promulgated
17under this chapter, the
commissioner department may by order summarily prohibit
18such person from further engaging in such activity in this state until licensed under
19this chapter.
AB150, s. 6742
20Section
6742. 551.60 (3) of the statutes is amended to read:
AB150,2191,1121
551.60
(3) If the public interest and the protection of investors so require, the
22commissioner department may by order summarily suspend all trading in this state
23by broker-dealers and agents in any security for any period specified. No
24broker-dealer or agent may effect any transaction in, or induce or attempt to induce
25the purchase or sale of, any security in this state in which trading is so suspended,
1except in performance of a contract previously entered into. At any time after the
2issuance of an order under this subsection, any interested person may in writing
3request that the suspension of trading be vacated. Upon the receipt of a written
4request, the matter shall be noticed for hearing and a hearing shall be held in the
5manner provided in s. 551.61 (2). After the hearing, the
commissioner department 6may order the suspension to be continued until modified or vacated by further order
7upon a finding that trading in the security will be unfair or inequitable or will tend
8to work a fraud upon the purchasers or sellers of the security. Otherwise, the
9commissioner department shall vacate the suspension of trading and no further
10order may be entered under this subsection with respect to the same security in the
11absence of changed circumstances justifying an order.
AB150, s. 6743
12Section
6743. 551.60 (4) of the statutes is amended to read:
AB150,2191,2113
551.60
(4) Every corporation, partnership or association having its principal
14office in this state or whose securities have been registered under this chapter or
15predecessor laws shall, within 20 days after receipt of written request from the
16commissioner department made in connection with any investigation under s.
17551.56 (1), furnish the
commissioner department with a list of all or part of its
18security holders as the
commissioner department requests, showing the amount of
19securities held by each security holder and the date of issuance of such securities and
20information reasonably related thereto, signed by the president, secretary or partner
21of the issuer or a person occupying a similar status or performing similar functions.