Unit 5 (Partial) Flashcards
Offer or offer to sell
Every attempt or offer to dispose of or solicitation of an offer to buy a security or interest in a security for value.
A gift of assessable stock is an offer for sell. A A GIFT of Nonassessable stock is not an offer for sell. If given bc of the purchase for something else (like a bonus) it is considered an offer to sell.
Radio / TV Jurisdiction of the administrator
Radio or television program is considered to originate in the state with a microphone or television camera is located
- The administrator would not have jurisdiction if the offer were made under any of the following circumstances:
- television or radio broadcast that originated outside of the state
- bona fide newspaper or periodical published outside of the state
- newspaper periodical publish inside the state but with more than 2/3 of its circulation outside of the state in the last year.
Does an administrator in state a need to ask permission from the administrator and state be to investigate?
No, and no appointment is necessary
Enjoined
Subject to an injunction
Vacated
The legal term: When the conditions that lead to the issuance of the stop order have changed for the better
How long does the administrator and Fenner I have jurisdiction after the withdrawal of registration?
Administrator: 1 year
FINRA: 2 years
***What would the administrator do with mailings to a registrant were required with no forwarding address?
Cancel the registration
The administrator may also cancel registration if a person has declared mentally incompetent
Canceling does not result from violations or failure to follow the provisions of the act. Cancellation occurs as a result of death dissolution or mental incompetency
IA and IAR suspension or revocation of license.
When the employers registration is suspended or revoked that of the registered individuals place in the suspense or some other term essentially the same affect. When the period of suspension of the firms over registration of the individual was reactivated.
If the firms registration has been revoked in the individual either have to find a new affiliation or the license will be canceled.
Individuals who drawl the registration must re-affiliate within two years it will be required to retake the exam.
Suing an IAR for improper investment advice.
Right if recision
No treble damages
An investment advisor may avoid legal expenses by offering the client the same package he would receive is if he had been sued including interest etc.
Unlike federal laws there’s no provision for receiving treble damages. No 3x what you lost. This is primarily an insider trading penalty.
Federal penalty ($) (jail time years) for SEC criminal violation?
USA penalty ($) (years of jail time) for USA criminal violation?
Federal: $Max $10K. Max 5 years imprisonment. Or both.
State: $5K Max. No more than 3 years of imprisonment. Or both.
Timelines
Hearing request
Statute of limitations for civil violations of USA
Judicial appeal - must be written within?
Hearings Request - written request must be made, and the hearing Will be had within 15 days after
Statute of limitations for civil violations of USA:
3 years from the date of the sale, or 2 years after discovering the violation - whichever comes first.
Judicial appeal - must be written within 60 days for SEC and state.
Right of recission
Letter of recission
The seller may pay back the buyer the original cost plus interest is if they’ve gone to court. But they avoid the court costs by offering the client this option with the letter of rescission.
Client has 30 days after receiving the letter to respond. If the buyer does not except or reject the offer within 30 days the buyer gives up any right to pursue a lawsuit at a later date. If the client rejects it, he may sue.
Civil liability
Criminal liability
Civil liability - it’s not violated a state criminal code (the law). No jail time, just fines.
Criminal liability- The accused person has violated the states criminal code (broken the law). Jail time option and fines.
SEC power to censure max amount of time?
No max for state admin
12 months
