SB483,94,6 4(3) No limitation on other criminal enforcement. This chapter does not limit
5the power of this state to punish a person for conduct that constitutes a crime under
6other laws of this state.
SB483,94,9 7551.509 Civil liability. (1) Securities Litigation Uniform Standards Act.
8Enforcement of civil liability under this section is subject to the Securities Litigation
9Uniform Standards Act of 1998.
SB483,94,15 10(2) Liability of seller to purchaser. A person is liable to the purchaser if the
11person sells a security in violation of s. 551.301 or 551.501 and, as to s. 551.501 (2),
12the purchaser did not know the untruth or omission and the seller cannot sustain the
13burden of proof that the seller did not know and, in the exercise of reasonable care,
14could not have known of the untruth or omission. An action under this subsection
15is governed by the following:
SB483,94,2016 (a) The purchaser may maintain an action to recover the consideration paid for
17the security, less the amount of any income received on the security, and interest at
18the legal rate under s. 138.04 from the date of the purchase, costs, and reasonable
19attorney fees determined by the court, upon the tender of the security, or for actual
20damages as provided in par. (c).
SB483,94,2421 (b) The tender referred to in par. (a) may be made any time before entry of
22judgment. Tender requires only notice in a record of ownership of the security and
23willingness to exchange the security for the amount specified. A purchaser that no
24longer owns the security may recover actual damages as provided in par. (c).
SB483,95,4
1(c) Actual damages in an action arising under this subsection are the amount
2that would be recoverable upon a tender less the value of the security when the
3purchaser disposed of it, and interest at the legal rate under s. 138.04 from the date
4of the purchase, costs, and reasonable attorney fees determined by the court.
SB483,95,10 5(3) Liability of purchaser to seller. A person is liable to the seller if the
6person buys a security in violation of s. 551.501 and, as to s. 551.501 (2), the seller
7did not know the untruth or omission and the purchaser cannot sustain the burden
8of proof that the purchaser did not know and, in the exercise of reasonable care, could
9not have known of the untruth or omission. An action under this subsection is
10governed by the following:
SB483,95,1311 (a) The seller may maintain an action to recover the security, and any income
12received on the security, costs, and reasonable attorney fees determined by the court,
13upon the tender of the purchase price, or for actual damages as provided in par. (c).
SB483,95,1814 (b) The tender referred to in par. (a) may be made any time before entry of
15judgment. Tender requires only notice in a record of the present ability to pay the
16amount tendered and willingness to take delivery of the security for the amount
17specified. If the purchaser no longer owns the security, the seller may recover actual
18damages as provided in par. (c).
SB483,95,2319 (c) Actual damages in an action arising under this subsection are the difference
20between the price at which the security was sold and the value the security would
21have had at the time of the sale in the absence of the purchaser's conduct causing
22liability, and interest at the legal rate under s. 138.04 from the date of the sale of the
23security, costs, and reasonable attorney fees determined by the court.
SB483,96,3 24(4) Liability of unregistered broker-dealer and agent. A person acting as
25a broker-dealer or agent that sells or buys a security in violation of s. 551.401 (1),

1551.402 (1), or 551.506 is liable to the customer. The customer, if a purchaser, may
2maintain an action for recovery of actual damages as specified in sub. (2) (a) to (c),
3or, if a seller, for a remedy as specified in sub. (3) (a) to (c).
SB483,96,10 4(5) Liability of unregistered investment adviser and investment adviser
5representative.
A person acting as an investment adviser or investment adviser
6representative that provides investment advice for compensation in violation of s.
7551.403 (1), 551.404 (1), or 551.506 is liable to the client. The client may maintain
8an action to recover the consideration paid for the advice, interest at the legal rate
9under s. 138.04 from the date of payment, costs, and reasonable attorney fees
10determined by the court.
SB483,96,16 11(6) Liability for investment advice. A person that receives directly or
12indirectly any consideration for providing investment advice to another person and
13that employs a device, scheme, or artifice to defraud the other person or engages in
14an act, practice, or course of business that operates or would operate as a fraud or
15deceit on the other person is liable to the other person. An action under this
16subsection is governed by the following:
SB483,96,2117 (a) The person defrauded may maintain an action to recover the consideration
18paid for the advice and the amount of any actual damages caused by the fraudulent
19conduct, interest at the legal rate under s. 138.04 from the date of the fraudulent
20conduct, costs, and reasonable attorney fees determined by the court, less the
21amount of any income received as a result of the fraudulent conduct.
SB483,96,2422 (b) This subsection does not apply to a broker-dealer or its agents if the
23investment advice provided is solely incidental to transacting business as a
24broker-dealer and no special compensation is received for the investment advice.
SB483,97,2
1(7) Joint and several liability. The following persons are liable jointly and
2severally with and to the same extent as persons liable under subs. (2) to (6):
SB483,97,63 (a) A person that directly or indirectly controls a person liable under subs. (2)
4to (6), unless the controlling person sustains the burden of proof that the person did
5not know, and in the exercise of reasonable care could not have known, of the
6existence of conduct by reason of which the liability is alleged to exist.
SB483,97,117 (b) An individual who is a managing partner, executive officer, or director of a
8person liable under subs. (2) to (6), including an individual having a similar status
9or performing similar functions, unless the individual sustains the burden of proof
10that the individual did not know, and in the exercise of reasonable care could not have
11known, of the existence of conduct by reason of which the liability is alleged to exist.
SB483,97,1612 (c) An individual who is an employee of or associated with a person liable under
13subs. (2) to (6) and who materially aids the conduct giving rise to the liability, unless
14the individual sustains the burden of proof that the individual did not know, and in
15the exercise of reasonable care could not have known, of the existence of conduct by
16reason of which the liability is alleged to exist.
SB483,97,2117 (d) A person that is a broker-dealer, agent, investment adviser, or investment
18adviser representative that materially aids the conduct giving rise to the liability
19under subs. (2) to (6), unless the person sustains the burden of proof that the person
20did not know, and in the exercise of reasonable care could not have known, of the
21existence of conduct by reason of which liability is alleged to exist.
SB483,97,24 22(8) Right of contribution. A person liable under this section has a right of
23contribution as in cases of contract against any other person liable under this section
24for the same conduct.
SB483,98,2
1(9) Survival of cause of action. A cause of action under this section survives
2the death of an individual who might have been a plaintiff or defendant.
SB483,98,3 3(10) Statute of limitations. A person may not obtain relief:
SB483,98,54 (a) Under sub. (2) for violation of s. 551.301, or under sub. (4) or (5), unless the
5action is instituted within one year after the violation occurred.
SB483,98,86 (b) Under sub. (2), other than for violation of s. 551.301, or under sub. (3) or (6),
7unless the action is instituted within the earlier of 2 years after discovery of the facts
8constituting the violation or 5 years after the violation.
SB483,98,13 9(11) No enforcement of violative contract. A person that has made, or has
10engaged in the performance of, a contract in violation of this chapter or a rule adopted
11or order issued under this chapter, or that has acquired a purported right under the
12contract with knowledge of conduct by reason of which its making or performance
13was in violation of this chapter, may not base an action on the contract.
SB483,98,17 14(12) No contractual waiver. A condition, stipulation, or provision binding a
15person purchasing or selling a security or receiving investment advice to waive
16compliance with this chapter or a rule adopted or order issued under this chapter is
17void.
SB483,98,20 18(13) Survival of other rights or remedies. The rights and remedies provided
19by this chapter are in addition to any other rights or remedies that may exist, but this
20chapter does not create a cause of action not specified in this section or s. 551.411 (5).
SB483,98,22 21551.511 Rescission offers. A purchaser, seller, or recipient of investment
22advice may not maintain an action under s. 551.509 if all of the following apply:
SB483,99,5 23(1) The purchaser, seller, or recipient of investment advice receives in a record,
24before the action is instituted, an offer stating the respect in which liability under
25s. 551.509 may have arisen and fairly advising the purchaser, seller, or recipient of

1investment advice of that person's rights in connection with the offer, and any
2financial or other information necessary to correct all material misrepresentations
3or omissions in the information that was required by this chapter to be furnished to
4that person at the time of the purchase, sale, or investment advice, and any of the
5following:
SB483,99,146 (a) If the basis for relief under this section may have been a violation of s.
7551.509 (2), an offer to repurchase the security for cash, payable on delivery of the
8security, equal to the consideration paid, and interest at the legal rate under s. 138.04
9from the date of the purchase, less the amount of any income received on the security,
10or, if the purchaser no longer owns the security, an offer to pay the purchaser upon
11acceptance of the offer damages in an amount that would be recoverable upon a
12tender, less the value of the security when the purchaser disposed of it, and interest
13at the legal rate under s. 138.04 from the date of the purchase in cash equal to the
14damages computed in the manner provided in this subsection.
SB483,99,2315 (b) If the basis for relief under this section may have been a violation of s.
16551.509 (3), an offer to tender the security, on payment by the seller of an amount
17equal to the purchase price paid, less income received on the security by the
18purchaser and interest at the legal rate under s. 138.04 from the date of the sale, or,
19if the purchaser no longer owns the security, an offer to pay the seller upon
20acceptance of the offer, in cash, damages in the amount of the difference between the
21price at which the security was purchased and the value the security would have had
22at the time of the purchase in the absence of the purchaser's conduct that may have
23caused liability and interest at the legal rate under s. 138.04 from the date of the sale.
SB483,100,3
1(c) If the basis for relief under this section may have been a violation of s.
2551.509 (4), and if the customer is a purchaser, an offer to pay as specified in par. (a),
3or, if the customer is a seller, an offer to tender or to pay as specified in par. (b).
SB483,100,64 (d) If the basis for relief under this section may have been a violation of s.
5551.509 (5), an offer to reimburse in cash the consideration paid for the advice and
6interest at the legal rate under s. 138.04 from the date of payment.
SB483,100,117 (e) If the basis for relief under this section may have been a violation of s.
8551.509 (6), an offer to reimburse in cash the consideration paid for the advice, the
9amount of any actual damages that may have been caused by the conduct, and
10interest at the legal rate under s. 138.04 from the date of the violation causing the
11loss.
SB483,100,15 12(2) The offer under sub. (1) states that it must be accepted by the purchaser,
13seller, or recipient of investment advice within 30 days after the date of its receipt
14by the purchaser, seller, or recipient of investment advice or any shorter period, of
15not less than 3 days, that the administrator, by order, specifies.
SB483,100,17 16(3) The offeror has the present ability to pay the amount offered or to tender
17the security under sub. (1).
SB483,100,20 18(4) The offer under sub. (1) is delivered to the purchaser, seller, or recipient of
19investment advice, or sent in a manner that ensures receipt by the purchaser, seller,
20or recipient of investment advice.
SB483,100,23 21(5) The purchaser, seller, or recipient of investment advice that accepts the
22offer under sub. (1) in a record within the period specified under sub. (2) is paid in
23accordance with the terms of the offer.
SB483,101,3
1subchapter Vi
2 ADMINISTRATION AND JUDICIAL
3 REVIEW
SB483,101,5 4551.601 Administration. (1) Administration. The administrator shall
5administer this chapter.
SB483,101,12 6(2) Unlawful use of records or information. It is unlawful for the
7administrator or an officer, employee, or designee of the administrator to use for
8personal benefit or the benefit of others records or other information obtained by or
9filed with the administrator that are not public under s. 551.607 (2). This chapter
10does not authorize the administrator or an officer, employee, or designee of the
11administrator to disclose the record or information, except in accordance with s.
12551.602, 551.607 (3), or 551.608.
SB483,101,15 13(3) No privilege or exemption created or diminished. This chapter does not
14create or diminish a privilege or exemption that exists at common law, by statute or
15rule, or otherwise.
SB483,102,2 16(4) Investor education. The administrator may develop and implement
17investor education initiatives to inform the public about investing in securities, with
18particular emphasis on the prevention and detection of securities fraud. In
19developing and implementing these initiatives, the administrator may collaborate
20with public and nonprofit organizations with an interest in investor education. The
21administrator may accept a grant or donation from a person that is not affiliated with
22the securities industry or from a nonprofit organization, regardless of whether the
23organization is affiliated with the securities industry, to develop and implement
24investor education initiatives. This subsection does not authorize the administrator

1to require participation or monetary contributions of a registrant in an investor
2education program.
SB483,102,7 3(5) Securities investor education and training funding. All moneys collected
4from the administrative assessment under s. 551.604 (4) shall be credited to the
5appropriation under s. 20.144 (1) (i). Subject to s. 20.144 (1) (i), the division shall use
6moneys credited to that appropriation for the purposes specified in sub. (4) and s.
720.144 (1) (i).
SB483,102,9 8551.602 Investigations and subpoenas. (1) Authority to investigate. The
9administrator may do any of the following:
SB483,102,1410 (a) Conduct public or private investigations within or outside of this state
11which the administrator considers necessary or appropriate to determine whether
12a person has violated, is violating, or is about to violate this chapter or a rule adopted
13or order issued under this chapter, or to aid in the enforcement of this chapter or in
14the adoption of rules and forms under this chapter.
SB483,102,1815 (b) Require or permit a person to testify, file a statement, or produce a record,
16under oath or otherwise as the administrator determines, as to all the facts and
17circumstances concerning a matter to be investigated or about which an action or
18proceeding is to be instituted.
SB483,102,2119 (c) Publish a record concerning an action, proceeding, or an investigation
20under, or a violation of, this chapter or a rule adopted or order issued under this
21chapter.
SB483,103,2 22(2) Administrator powers to investigate. For the purpose of an investigation
23under this chapter, the administrator or its designated officer may administer oaths
24and affirmations, subpoena witnesses, seek compulsion of attendance, take

1evidence, require the filing of statements, and require the production of any records
2that the administrator considers relevant or material to the investigation.
SB483,103,9 3(3) Procedure and remedies for noncompliance. If a person does not appear
4or refuses to testify, file a statement, produce records, or otherwise does not obey a
5subpoena as required by the administrator under this chapter, the administrator
6may apply to, or may refer the matter to the attorney general, district attorney of the
7appropriate county, or appropriate federal authority who may apply to, the circuit
8court of of the appropriate county or a court of another state to enforce compliance.
9The court may do any of the following:
SB483,103,1010 (a) Hold the person in contempt.
SB483,103,1111 (b) Order the person to appear before the administrator.
SB483,103,1312 (c) Order the person to testify about the matter under investigation or in
13question.
SB483,103,1414 (d) Order the production of records.
SB483,103,1615 (e) Grant injunctive relief, including restricting or prohibiting the offer or sale
16of securities or the providing of investment advice.
SB483,103,1817 (f) Impose a civil penalty of not less than $5,000 and not greater than $250,000
18for each violation.
SB483,103,1919 (g) Grant any other necessary or appropriate relief.
SB483,103,23 20(4) Application for relief. This section does not preclude a person from
21applying to the circuit court of the appropriate county or a court of another state for
22relief from a request to appear, testify, file a statement, produce records, or obey a
23subpoena.
SB483,104,12 24(5) Use immunity procedure. (a) An individual is not excused from attending,
25testifying, filing a statement, producing a record or other evidence, or obeying a

1subpoena of the administrator under this chapter or in an action or proceeding
2instituted by the administrator under this chapter on the ground that the required
3testimony, statement, record, or other evidence, directly or indirectly, may tend to
4incriminate the individual or subject the individual to a criminal fine, penalty, or
5forfeiture. If the individual refuses to testify, file a statement, or produce a record
6or other evidence on the basis of the individual's privilege against self-incrimination,
7the administrator may apply to the circuit court of the appropriate county to compel
8the testimony, the filing of the statement, the production of the record, or the giving
9of other evidence. The testimony, record, or other evidence compelled under such an
10order may not be used, directly or indirectly, against the individual in a criminal case,
11except in a prosecution for perjury or contempt or otherwise failing to comply with
12the order.
SB483,104,1413 (b) The immunity provided under par. (a) is subject to the restrictions under
14s. 972.085.
SB483,105,6 15(6) Assistance to securities regulator of another jurisdiction. At the
16request of the securities regulator of another state or a foreign jurisdiction, the
17administrator may provide assistance if the requesting regulator states that it is
18conducting an investigation to determine whether a person has violated, is violating,
19or is about to violate a law or rule of the other state or foreign jurisdiction relating
20to securities matters that the requesting regulator administers or enforces. The
21administrator may provide the assistance by using the authority to investigate and
22the powers conferred by this section as the administrator determines is necessary or
23appropriate. The assistance may be provided without regard to whether the conduct
24described in the request would also constitute a violation of this chapter or other law
25of this state if occurring in this state. In deciding whether to provide the assistance,

1the administrator may consider whether the requesting regulator is permitted and
2has agreed to provide assistance reciprocally within its state or foreign jurisdiction
3to the administrator on securities matters when requested; whether compliance with
4the request would violate or prejudice the public policy of this state; and the
5availability of resources and employees of the administrator to carry out the request
6for assistance.
SB483,105,17 7551.603 Civil enforcement. (1) Civil action instituted by administrator.
8If the administrator believes that a person has engaged, is engaging, or is about to
9engage in an act, practice, or course of business constituting a violation of this
10chapter or a rule adopted or order issued under this chapter or that a person has, is,
11or is about to engage in an act, practice, or course of business that materially aids a
12violation of this chapter or a rule adopted or order issued under this chapter, the
13administrator may maintain, or may refer the matter to the attorney general or
14district attorney of the appropriate county who may maintain, an action in the circuit
15court of the appropriate county to enjoin the act, practice, or course of business and
16to enforce compliance with this chapter or a rule adopted or order issued under this
17chapter.
SB483,105,19 18(2) Relief available. In an action under this section and on a proper showing,
19the court may do any of the following:
SB483,105,2120 (a) Issue a permanent or temporary injunction, restraining order, or
21declaratory judgment.
SB483,105,2322 (b) Order other appropriate or ancillary relief, which may include any of the
23following:
SB483,106,3
11. An asset freeze, accounting, writ of attachment, writ of general or specific
2execution, and appointment of a receiver or conservator, that may be the
3administrator, for the defendant or the defendant's assets.
SB483,106,64 2. Ordering the administrator to take charge and control of a defendant's
5property, including investment accounts and accounts in a depository institution,
6rents, and profits; to collect debts; and to acquire and dispose of property.
SB483,106,117 3. Imposing a civil penalty up to $5,000 for a single violation or up to $250,000
8for more than one violation; an order of rescission, restitution, or disgorgement
9directed to a person that has engaged in an act, practice, or course of business
10constituting a violation of this chapter or the predecessor act or a rule adopted or
11order issued under this chapter or the predecessor act.
SB483,106,1212 4. Ordering the payment of prejudgment and postjudgment interest.
SB483,106,1313 (c) Order such other relief as the court considers appropriate.
SB483,106,15 14(3) No bond required. The administrator may not be required to post a bond
15in an action or proceeding under this chapter.
SB483,106,22 16551.604 Administrative enforcement. (1) Issuance of an order or notice.
17If the administrator determines that a person has engaged, is engaging, or is about
18to engage in an act, practice, or course of business constituting a violation of this
19chapter or a rule adopted or order issued under this chapter or that a person has
20materially aided, is materially aiding, or is about to materially aid an act, practice,
21or course of business constituting a violation of this chapter or a rule adopted or order
22issued under this chapter, the administrator may do any of the following:
SB483,106,2523 (a) Issue an order directing the person to cease and desist from engaging in the
24act, practice, or course of business or to take other action necessary or appropriate
25to comply with this chapter.
SB483,107,3
1(b) Issue an order denying, suspending, revoking, or conditioning the
2exemptions for a broker-dealer under s. 551.401 (2) (d) or (f) or an investment adviser
3under s. 551.403 (2) (a) 3.
SB483,107,44 (c) Issue an order under s. 551.204.
SB483,107,18 5(2) Summary process. An order under sub. (1) is effective on the date of
6issuance. Upon issuance of the order, the administrator shall promptly serve each
7person subject to the order with a copy of the order and a notice that the order has
8been entered. The order must include a statement of any civil penalty or costs of
9investigation the administrator will seek, a statement of the reasons for the order,
10and notice that, within 15 days after receipt of a request in a record from the person,
11the matter will be scheduled for a hearing. If a person subject to the order does not
12request a hearing and none is ordered by the administrator within 30 days after the
13date of service of the order, the order, including the imposition of a civil penalty or
14requirement for payment of the costs of investigation sought in a statement in the
15order, becomes final as to that person by operation of law. If a hearing is requested
16or ordered, the administrator, after notice of and opportunity for hearing to each
17person subject to the order, may modify or vacate the order or extend it until final
18determination.
SB483,107,23 19(3) Procedure for final order. If a hearing is requested or ordered pursuant
20to sub. (2), a hearing must be held pursuant to ch. 227. A final order may not be
21issued unless the administrator makes findings of fact and conclusions of law in a
22record in accordance with ch. 227. The final order may make final, vacate, or modify
23the order issued under sub. (1).
SB483,108,3
1(4) Civil penalty. In a final order under sub. (3), the administrator may impose
2a civil penalty in the form of an administrative assessment up to $5,000 for a single
3violation or up to $250,000 for more than one violation.
SB483,108,6 4(5) Costs. In a final order, the administrator may charge the actual cost of an
5investigation or proceeding for a violation of this chapter or a rule adopted or order
6issued under this chapter.
SB483,108,12 7(6) Filing of certified final order with court; effect of filing. If a petition
8for judicial review of a final order is not filed in accordance with s. 551.609, the
9administrator may file a certified copy of the final order with the clerk of a court of
10competent jurisdiction. The order so filed has the same effect as a judgment of the
11court and may be recorded, enforced, or satisfied in the same manner as a judgment
12of the court.
SB483,108,21 13(7) Enforcement by court; further civil penalty. If a person does not comply
14with an order under this section, the administrator may petition a court of competent
15jurisdiction to enforce the order. The court may not require the administrator to post
16a bond in an action or proceeding under this section. If the court finds, after service
17and opportunity for hearing, that the person was not in compliance with the order,
18the court may adjudge the person in civil contempt of the order. The court may
19impose a further civil penalty against the person for contempt in an amount not less
20than $5,000 but not greater than $100,000 for each violation and may grant any
21other relief the court determines is just and proper in the circumstances.
SB483,108,24 22551.605 Rules, forms, orders, interpretative opinions, and hearings.
23(1) Issuance and adoption of forms, orders, and rules. The administrator may do
24any of the following:
SB483,109,4
1(a) Issue forms and orders and, after notice and comment, adopt and amend
2rules necessary or appropriate to carry out this chapter, and repeal rules, including
3rules and forms governing registration statements, applications, notice filings,
4reports, and other records.
SB483,109,65 (b) By rule, define terms, whether or not used in this chapter, but those
6definitions may not be inconsistent with this chapter.
SB483,109,87 (c) By rule, classify securities, persons, and transactions and adopt different
8requirements for different classes.
SB483,109,17 9(2) Findings and cooperation. Under this chapter, except as provided under
10s. 551.412 (4g) (b) and (c), a rule or form may not be adopted or amended, or an order
11issued or amended, unless the administrator finds that the rule, form, order, or
12amendment is necessary or appropriate in the public interest or for the protection
13of investors and is consistent with the purposes intended by this chapter. In
14adopting, amending, and repealing rules and forms, s. 551.608 applies in order to
15achieve uniformity among the states and coordination with federal laws in the form
16and content of registration statements, applications, reports, and other records,
17including the adoption of uniform rules, forms, and procedures.
SB483,109,23 18(3) Financial statements. Subject to section 15 (h) of the Securities Exchange
19Act and section 222 of the Investment Advisers Act of 1940, the administrator may
20require that a financial statement filed under this chapter be prepared in accordance
21with generally accepted accounting principles in the United States and comply with
22other requirements specified by rule adopted or order issued under this chapter. A
23rule adopted or order issued under this chapter may establish:
SB483,110,3
1(a) Subject to section 15 (h) of the Securities Exchange Act and section 222 of
2the Investment Advisers Act of 1940, the form and content of financial statements
3required under this chapter.
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