_Hlk168490361DFI-Sec 3.03 (1) (a) Any written offer made to the person, otherwise other than by means of public advertisement;. (c) Payment pursuant to any sale to the person; or.
(2) (a) Name and location of issuer and its type of organization ;.
(b) Designation of securities offered ;.
(c) Per share or unit and aggregate public offering price, underwriting or selling commissions, and discounts and net proceeds to offeror;.
(d) Name of managing underwriter or broker-dealer or statement that the securities are being offered by the issuer;.
(e) A statement describing the anticipated secondary market for the securities being offered, including the identity of anticipated market makers;.
(f) Date of prospectus;.
(g) If the offering is the subject of a registration statement under the securities act of 1933, the following statements in bold-face type:
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.;
(3) The prospectus shall contain a full disclosure of all material facts relating to the issuer and the offering and sale of the registered securities. A prospectus meeting the requirements under the securities act of 1933 that receives full review by the U.S. securities and exchange commission, shall not be subject to disclosure adequacy review or comment by the division. If the offering is being made pursuant to use of either Regulation A or Rule 504 of Regulation D under the securities act of 1933 or Rule 147 under section 3 (a) (11) of the securities act of 1933, the form U-7 disclosure document as adopted in amended form on September 28, 1999 by the North American Securities Administrators Association, Inc. may be used.
(4) (intro.) The disclosure-related provisions of the following guidelines or statements of policy of the North American Securities Administrators Association or other state securities organization listed, may be used by the division for purposes of reviewing the adequacy of disclosure in the prospectus filed with the registration application: .
SECTION 55. DFI-Sec 3.03 (4) (a) to (q) are repealed.
SECTION 56. DFI-Sec 3.03 (4) Note is amended to read:
DFI-Sec 3.03 (4) Note: All of the NASAA Guidelines are published in CCH NASAA Reports published by Commerce Clearing House and are on file at the offices of the Wisconsin secretary of state and the legislative reference bureau available for review on the NASAA website at www.nasaa.org. SECTION 57. DFI-Sec 3.03 (5) is amended to read:
DFI-Sec 3.03 (5) Unless otherwise permitted by the division, the body of the prospectus and all notes to financial statements and other included tabular data included therein shall be in roman or gothic type at least as large and as legible as 10-point modern type, except that financial statements and other tabular data, including tabular data in notes, may be in roman or gothic type at least as large and as legible as 8-point modern type. All such type shall be leaded at least 2 points.
SECTION 58. DFI-Sec 3.04 is amended to read:
DFI-Sec 3.04 Trust indentures required under ch. 551, Stats., and chs. DFI-Sec 1 to 9, shall meet the requirements of the trust indenture act Trust Indenture Act of 1939, whether or not exempt under that act, unless the division otherwise permits or requires. DFI-Sec 3.05 (3) The division may institute a proceeding under s. 551.306, Stats., and may issue a stop order suspending or revoking the effectiveness of any registration statement filed under s. 551.303 or 551.304, Stats., at any time during the period that the registration statement is effective and within one year thereafter. SECTION 60. DFI-Sec 3.07 is amended to read:
DFI-Sec 3.07 (1) Application for an extension of the offering period of a registration statement, except one relating to securities of a finance company registered licensed under s. 138.09, Stats., shall be filed in the form prescribed by the division not less than 30 days prior to the end of one year from the effective date of the registration statement or an extended period of effectiveness for the registration statement, whichever is most recent. The application shall be accompanied by a prospectus updated in accordance with s. DFI-Sec 3.03 (6), a balance sheet of the issuer as of the end of its most recent fiscal year, and a comparative statement of income and changes in financial position and analysis of surplus for each of the 3 most recent fiscal years (or for the period of the issuer’s and any predecessor’s existence if less than 3 years), all meeting the requirements of s. DFI-Sec 7.06, provided that if the date of any of the above financial statements is more than 120 days (180 days with respect to a corporation organized and operated not for private profit but exclusively for religious, educational, benevolent, or charitable purposes) prior to the date of the extension of the registration statement, the statements shall be updated (which may be done without audit) to within the 120-day or 180-day requirement above. If no order specifying a different effectiveness period is in effect, renewal of the registration statement becomes effective on the day on which the prior registration statement expires or at such earlier time as the division determines. (2) A registration statement relating to securities of a finance company registered [licensed] licensed under s. 138.09, Stats., is deemed to include an application for the continuous offering of the securities. The offering period of the registration statement is automatically extended until it is permitted to be withdrawn or the division issues a stop order suspending or revoking its effectiveness pursuant to s. 551.306, Stats., if the issuer files with the division not less than annually during the offering period, within 120 days of the end of its fiscal year, a prospectus updated in accordance with s. DFI-Sec 3.03 (6), a balance sheet of the issuer as of the end of the fiscal year, and a statement of income and change in financial position and analysis of surplus of the issuer for the fiscal year meeting the requirements of s. DFI-Sec 7.06. Note: The correct word is shown in brackets.
_Hlk168564394SECTION 61. DFI-Sec 4.01 (1) (a) is amended to read: DFI-Sec 4.01 (1) (a) (intro.) Applications for initial and renewal registrations of broker-dealers and agents, as well as amendments, reports, notices, related filings, and fees, shall be filed with all of the following:
1. The division on forms prescribed by the division in s. DFI-Sec 9.01 (1); or 9. _Hlk1747181442. The central registration depository of the financial industry regulatory authority Financial Industry Regulatory Authority as developed under contract with the North American securities administrators association Securities Administrators Association, on forms established for the central registration depository. SECTION 62. DFI-Sec 4.01 (1) (c) is created to read:
DFI-Sec 4.01 (1) (c) A broker-dealer may not register with the division, or continue to be registered with the division, unless the broker-dealer is registered with the Financial Industry Regulatory Authority and maintains that registration.
SECTION 63. DFI-Sec 4.01 (2) (a), (b), and (c) and (3) (intro.) are amended to read:
_Hlk168564926DFI-Sec 4.01 (2) (a) Except as provided in par. (b), an “application" for purposes of s. 551.406 (1), Stats., means all information required by the form prescribed under sub. (1) s. 551.406 (1), Stats., together with any additional information required by the division. (b) An application for initial registration or for renewal of a registration as a broker-dealer registered with the financial industry regulatory authority Financial Industry Regulatory Authority includes the payment of the Wisconsin broker-dealer registration fee and, in the case of an initial application, the examination fee prescribed by s. DFI-Sec 7.01 (3) (a), to the central registration depository of the financial industry regulatory authority Financial Industry Regulatory Authority. An application for initial registration as a broker-dealer under this paragraph shall be deemed filed under s. 551.406 (1), Stats., on the date the application is transferred from “NO STATUS" to “PENDING" on the records of the central registration depository. An application for renewal of a registration as a broker-dealer under this paragraph shall be deemed filed under s. 551.406 (1), Stats., when the fee on deposit with the central registration depository has been allocated to the division. (c) An “application" for initial registration or for renewal of a registration as a securities agent for a broker-dealer registered with the financial industry regulatory authority Financial Industry Regulatory Authority includes the payment of Wisconsin agent registration fees to the central registration depository. An application for initial registration as an agent under this paragraph shall be deemed “filed" under s. 551.406 (1), Stats., on the date when the application is designated ready for approval on the records of the central registration depository. An application for renewal of a registration as an agent under this paragraph shall be deemed “filed" under s. 551.406 (1), Stats., when the fee on deposit with the central registration depository has been allocated to the division. (3) (intro.) Unless waived under sub. (4) and subject to sub. (3) (m), each applicant for an initial registration as a broker-dealer or agent is required to take and pass within the two year period immediately preceding the “FILING DATE" of the application reflected on the records of the central registration depository, either the Series 63 Uniform Securities Agent State Law Examination or the Series 66 Uniform Combined State Law Examination, and take and pass within the that same two year period immediately preceding the “FILING DATE" of the application reflected on the records of the central registration depository, or receive a waiver from passing, the general securities business examinations in par. (a), unless the applicant's proposed securities activities will be restricted, in which case the applicant is required to take and pass , or receive a waiver from passing, each examination in pars. (b) to (h) one of the FINRA representative level examinations listed in this subsection that relates to the applicant's proposed securities activities: _Hlk175046627SECTION 64. DFI-Sec 4.01 (3) (e), (f), and (g) are repealed. SECTION 65. DFI-Sec 4.01 (3) (h) is renumbered DFI-Sec 4.01 (3) (dm).
SECTION 66. DFI-Sec 4.01 (3m) is created to be:
DFI-Sec 4.01 (3m) Each applicant for an initial registration as a broker-dealer or agent is required to pass or receive credit for the FINRA Securities Industry Essentials examination.
SECTION 67. DFI-Sec 4.01 (4) (intro.), (b) (intro.), and 2. are amended to read:
DFI-Sec 4.01 (4) (intro.) The examination requirement in sub. (3) is waived for any applicant who meets the criteria set forth in any one of the paragraphs in this subsection following criteria: (b) (intro.) The applicant has been registered within 2 years prior to the date the application is filed in this state, as an agent or as a broker-dealer under the securities law of another state and the following applicable conditions are met:
2. In the case of examinations required by sub. (3) (a) to (e), the applicant has been registered with the financial industry regulatory authority Financial Industry Regulatory Authority to engage in the type of business for which the applicant is applying for registration within 2 years prior to the date of filing of the application for registration. SECTION 68. DFI-Sec 4.01 (4) (c) is repealed.
SECTION 69. DFI-Sec 4.01 (4) (e) and (f) are amended to read:
DFI-Sec 4.01 (4) (e) The applicant is currently registered and in good standing with The Securities and Futures the Financial Conduct Authority of Great Britain and has passed the Series 17 Modified General Securities Representative Qualification Examination qualification examination for United Kingdom Representatives representatives, and either the Series 63 Uniform Securities Agent State Law Examination or the Series 66 Uniform Combined State Law Examination, except that the applicant's activities may not include the offer and sale of municipal Securities securities unless the applicant passes the examination listed in sub. (3) (d). (f) The applicant is currently registered and in good standing as an agent with any Canadian stock exchange or with a securities regulator of any Canadian province or territory, or with the Investment Dealers Association Industry Regulatory Organization of Canada and has passed either the Series 37 or Series 38 Canada modules of the Series 7 general securities representative qualification examination for Canadian representatives, and either the Series 63 Uniform Securities Agent State Law Examination or the Series 66 Uniform Combined State Law Examination, except that the applicant's activities may not include the offer and sale of municipal securities unless the applicant passes the examination listed in sub. (3) (d). SECTION 70. DFI-Sec 4.01 (4) (g) is created to read:
DFI-Sec 4.01 (4) (g) The applicant has not been registered as an agent in any state for more than two years but less than five years and has elected to participate in the FINRA Maintaining Qualifications Program pursuant to FINRA Rule 1240(c), and the applicant’s appropriate FINRA qualifying examinations remain valid pursuant to effective participation in the FINRA Maintaining Qualifications Program. The applicant shall be deemed in compliance with the examination requirements of sub. (3) if the applicant elected to participate in the NASAA Examination Validity Extension Program within two years of their agent registration termination and the applicant was registered as an agent in at least one state for at least one year immediately preceding the agent registration termination.
SECTION 71. DFI-Sec 4.01 (5), (7) and Note, and (8) (intro.), (a), (c), and (d) are amended to read:
DFI-Sec 4.01 (5) Any application for registration which is not completed or withdrawn within 6 months from the date it is initially received may be deemed materially incomplete, and the division may issue an order denying the registration or entering a record to the central registration depository that the application was abandoned.
_Hlk168998294(7) A securities agent registration is effective to authorize the licensee [registrant] registrant to effectuate transactions only in the types of categories of securities that the licensee [registrant] registrant has been qualified to sell by passing the examinations specified in sub. (3). Note: The correct word is shown in brackets.
(8) (intro.) For an agent to simultaneously represent in this state more than one broker-dealer pursuant to s. 551.402 (5), Stats., or an issuer pursuant to s. 551.402 (6), Stats., the agent shall meet the following requirements shall be met, in addition to the regular agent registration requirements: (a) Each broker-dealer or issuer that the agent represents shall sign on a form designated by the division in s. DFI-Sec 9.01 (1) (b) DFI-Sec 9, a written grant of permission to the agent to represent the other employers. The written grant of permission shall include the identity of all other securities employment affiliations of the agent and contain a listing of all restrictions on the agent's securities activities imposed by the agent's employers. (c) The agent shall file the manually signed original of the form under par. (a) shall be filed with the division together with a written application, which may be in letter form, on behalf of the agent to simultaneously represent more than one broker-dealer or issuer. The division shall must approve the application in writing prior to the agent's transacting securities business while simultaneously representing more than one broker-dealer or issuer. (d) Written An agent shall provide to each securities customer of the agent written disclosure shall be provided regarding the agent's simultaneous representation of more than one broker-dealer or issuer, including the information in par. (a), to each securities customer of the agent not later than the date of receipt of the confirmation for the first securities transaction for the account of the customer by the agent after dual registration is approved by the division. SECTION 72. DFI-Sec 4.02 (2) and (4) are amended to read:
DFI-Sec 4.02 (2) The aggregate indebtedness of each broker-dealer to all other persons shall may not exceed the levels prescribed under rule 15c3-1 of the securities exchange act Securities Exchange Act of 1934.
(4) The division may by order exempt any broker-dealer from the provisions of this subsection, either unconditionally or upon specified conditions, if by reason of the broker-dealer's membership on a national securities exchange or the special nature of its business and its financial position, and the safeguards that have been established for the protection of customers' funds and securities, the division finds the provisions are not necessary in to protect the public interest or for the protection of investors.
_Hlk168576976SECTION 73. DFI-Sec 4.03 (2), (4), (5), and (6) are amended to read: DFI-Sec 4.03 (2) Every registered broker-dealer shall preserve the records required under sub. (1) according to the schedule provided in rule 17a-4 under the securities exchange act Securities Exchange Act of 1934 in compliance with the requirements of the U.S. securities and exchange commission Securities and Exchange Commission concerning preservation and microfilming of records or other means of by electronic or other means of records retention of records. (4) Every registered broker-dealer shall preserve the branch office records required under sub. (3) according to the schedule provided in rule 17a-4(k) under the securities exchange act Securities Exchange Act of 1934 in compliance with the requirements of the U.S. securities and exchange commission Securities and Exchange Commission concerning preservation and microfilming of records by electronic or other means of records retention of records. (5) This section does not require a registered broker-dealer to make and keep such records of transactions cleared for the licensee [registrant] registrant by another broker-dealer as are customarily made and kept by the clearing broker-dealer.
(6) The division may by order exempt any broker-dealer from all or part of the requirements of this section, either unconditionally or upon specified conditions, if by reason of the special nature of its business, the division finds the issuance of the order application or enforcement of all or part of such requirements is not necessary or appropriate in to the public interest or for the protection of investors.
_Hlk198225180SECTION 74. DFI-Sec 4.04 (3), (4) (intro.) and (a), (7) (c), and (8) are amended to read: DFI-Sec 4.04 (3) Except as provided in subs. (2) and (8), each Each broker-dealer shall file with the division any notice of change of control or change of name, as well as any material change in the information included in the broker-dealer's most recent application for registration, in an amendment to Form BD filed with the central registration depository within 30 days of the date of the change. (4) (intro.) Every broker-dealer shall file with the division all the following reports concerning its net capital and aggregate indebtedness:
(a) Immediate electronic or written notice whenever the net capital of the broker-dealer is less than is required under s. DFI-Sec 4.02 (1), specifying the respective amounts of its net capital and aggregate indebtedness on the date of the notice;. (7) (c) The notification required to be provided to the division under par. (a) or (b) shall be made electronically on Form BR via the central registration depository by broker-dealers eligible to file electronically, and shall be made directly with the division by broker-dealers that are not eligible to file electronically with the central registration depository. (8) Each Annually, each broker-dealer shall file a branch office renewal notice annually with . with the central registration depository by broker-dealers eligible to file electronically, and shall be made directly with the division by broker-dealers that are not eligible to file electronically with the central registration depository.
_Hlk198225210SECTION 75. DFI-Sec 4.05 (3), (4), (7), (8) (intro.), (a), (b), (c) (intro.), 1. (intro.), and 2., (d) to (f), and (g) (intro.) are amended to read: _Hlk168581365DFI-Sec 4.05 (3) A broker-dealer shall may not enter into any contract with a customer if the contract contains any condition, stipulation, or provision binding the customer to waive any rights under ch. 551, Stats., or any rule or order thereunder. Any such condition, stipulation, or provision is void. _Hlk168582035(4) No broker-dealer shall may permit or effect a withdrawal of any part of its net worth, including subordinated indebtedness, whether by redemption, retirement, repurchase, repayment, or otherwise, that would cause its net capital or its aggregate indebtedness to violate s. DFI-Sec 4.02 (1) or (2), without prior written approval of the division. _Hlk168583472(7) No broker-dealer may associate with a bank, savings institution, trust company, savings and loan association, or credit union by contract, agreement or other means for the purpose of that entity publishing or circulating advertising promoting the services offered by the broker-dealer or assisting or providing information to persons to establish an account with the broker-dealer unless one of the following applies: (a) The promotional or account-establishing functions are performed by persons registered as securities agents representing the broker-dealer; or .
(b) The promotional or account-establishing functions are performed by persons who are supervised by one of at least 2 persons at the bank, savings institution, trust company, savings and loan association, or credit union who are officers, branch or assistant branch managers, or other employees occupying a similar office or performing similar functions at each location where promotional or account-opening functions are performed, and the supervisors are registered as securities agents representing the broker-dealer.
(8) (intro.) No broker-dealer shall may conduct broker-dealer services on the premises of a financial institution where retail deposits are taken unless the broker-dealer complies initially and continuously with all of the following requirements:
(a) The broker-dealer services shall be are conducted, wherever practical, in a physical location distinct from the area in which the financial institution's retail deposits are taken. In all situations, the broker-dealer shall identify its services in a manner that clearly distinguishes those services from the financial institution's retail deposit-taking activities. The broker-dealer's name shall be clearly displayed in the area in which the broker-dealer conducts its broker-dealer services. Nothing in this paragraph prohibits the financial institution from carrying out other activities within the designated area, provided that no promotional signs or materials shall be are displayed in the designated area other than those relating to the securities services.
(b) 1. Networking and brokerage affiliate arrangements shall be are governed by a written agreement that sets forth the responsibilities of the parties and the compensation arrangements.
2. Networking and brokerage affiliate arrangements shall provide that supervisory personnel of the broker-dealer and representatives of state securities authorities, where authorized by state law, will be permitted access to the financial institution's premises where the broker-dealer conducts securities services in order to inspect the books and records and other relevant information maintained by the broker-dealer with respect to its securities services.
3. The broker-dealer shall ensure ensures that the networking and brokerage affiliate arrangement clearly outlines the duties and responsibilities of all parties. For purposes of this paragraph, “networking arrangement" and “brokerage affiliate arrangement" mean a contractual or other arrangement between a broker-dealer and a financial institution pursuant to which the broker-dealer conducts securities services on the premises of a financial institution where retail deposits are taken.
(c) (intro.) At or prior to the time that a customer's securities brokerage account is opened by a broker-dealer on the premises of a financial institution where retail deposits are taken, the broker-dealer shall comply with does all of the following.:
1. (intro.) Disclose Discloses to the customer, orally and in writing, all of the following information about the securities products purchased or sold in a transaction with the broker-dealer:
2. Make Makes reasonable efforts to obtain from each customer during the account-opening process, a written acknowledgment of the disclosures required by subd. 1. (d) If securities services include any written or oral representations concerning insurance coverage, other than FDIC or similar insurance coverage, then the broker-dealer provides clear and accurate, written or oral explanations of the coverage shall also be provided to the customers when the representations are first made.
(e) Recommendations Subject to sub. (8m) (c), recommendations by a broker-dealer concerning any non-deposit investment product with a name similar to that of the financial institution shall occur only pursuant to a sales program designed to minimize the risk of customer confusion.
