Section 409.863

Title XXVI TRADE AND COMMERCE

Chapter 409

Effective - 28 Aug 1985   

  409.863.  Licenses — denial, suspension, revocation, limitations, cancellation — grounds. — 1.  The commissioner may, by order, deny, suspend, or revoke any license, limit the activities which an applicant or licensed person may perform in this state, conserve any applicant or licensed person, or bar any applicant or licensed person from association with a licensed commodity broker-dealer, if the commissioner finds that the order is in the public interest and that the applicant or licensed person or, in the case of a commodity broker-dealer any partner, officer, or director, any person occupying a similar status or performing similar functions, or any person directly or indirectly controlling the commodity broker-dealer:

  (1)  Has filed an application for licensing with the commissioner, or his designee, which, as of its effective date, or as of any date after filing in the case of an order denying effectiveness, was incomplete in any material respect or contained any statement which was, in light of the circumstances under which it was made, false or misleading with respect to any material fact;

  (2)  Has violated or failed to comply with a provision of sections 409.800 to 409.863 or a rule or order promulgated or issued under sections 409.800 to 409.863;

  (3)  Is the subject of an adjudication or determination within the last five years by a securities agency or administrator or court of competent jurisdiction that the person has willfully violated the Securities Act of 1933, the Securities Exchange Act of 1934, the Investment Advisers Act of 1940, the Investment Company Act of 1940, or the Commodity Exchange Act, or the securities law of any other state, but only if the acts constituting the violation of that state's law would constitute a violation of sections 409.800 to 409.863 had the acts taken place in this state;

  (4)  Has, within the last ten years, pled guilty or nolo contendere to, or been convicted of, any crime indicating a lack of fitness to engage in the investment commodities business;

  (5)  Is permanently or temporarily enjoined by any court of competent jurisdiction from engaging in, or continuing, any conduct or practice demonstrating^* a lack of fitness to engage in the investment commodities business;

  (6)  Is the subject of an order of the commissioner denying, suspending, or revoking the person's license as a commodity or securities broker-dealer, sales representative, or investment adviser;

  (7)  Is the subject of any of the following orders which are currently effective and which were issued within the last five years:

  (a)  An order by the securities agency or administrator of another state, Canadian province or territory, or the Securities and Exchange Commission, entered after notice and opportunity for hearing, denying, suspending, or revoking the person's license as a commodities or securities broker-dealer, sales representative, or investment adviser, or the substantial equivalent of those terms;

  (b)  A suspension or expulsion from membership in or association with a self-regulatory organization registered under the Securities and Exchange Act of 1934 or the Commodity Exchange Act;

  (c)  A United States Postal Service fraud order;

  (d)  A cease and desist order entered after notice and opportunity for hearing by the commissioner or the securities agency or administrator of any other state, Canadian province or territory, the Securities and Exchange Commission, or the Commodity Futures Trading Commission;

  (e)  An order entered by the Commodity Futures Trading Commission denying, suspending, or revoking registration under the Commodity Exchange Act;

  (8)  Has engaged in any unethical or dishonest conduct or practice in the investment commodities or securities business;

  (9)  Is insolvent, either in the sense that liabilities exceed assets, or in the sense that obligations cannot be met as they mature;

  (10)  Is not qualified on the basis of such factors as training, experience, and knowledge of the securities business, which determination shall be governed and limited by the provisions of subsection 3 of this section;

  (11)  Has failed reasonably to supervise sales representatives or employees; or

  (12)  Has failed to pay the proper filing fee within thirty days after being notified by the commissioner of the deficiency.  The commissioner shall vacate any order made under this subdivision when such deficiency has been corrected.

  2.  The commissioner may not institute a suspension or revocation proceeding on the basis of a fact or transaction disclosed in the license application unless the proceeding is instituted within the next ninety days following issuance of the license.

  3.  If the public interest or the protection of investors so requires, the commissioner may, by order, summarily suspend a license or postpone the effective date of a license.  Upon the entry of the order the commissioner shall promptly notify the applicant or licensed person, as well as the commodity broker-dealer with whom the person is or will be associated if the applicant or licensed person is a commodity sales representative, that an order has been entered and of the reasons therefor and that within fifteen days after the receipt of a written request the matter will be set down for hearing.  The provisions of this section shall apply with respect to all subsequent proceedings.

  4.  If the commissioner finds that any applicant or licensed person is no longer in existence or has ceased to do business as a broker-dealer, sales representative, or investment adviser, or is subject to an adjudication of mental incompetence or to the control of a committee, conservator, or guardian, or cannot be located after reasonable search, the commissioner may, by order, cancel the application or license.

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(L. 1985 H.B. 409 & 532 § 26)

*Word "demonstrating" does not appear in original rolls.