Session Laws

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1. Section 204 of chapter 110A of the General Laws, as appearing in the 1990 Official Edition, is hereby amended by inserting after the word "order", in line 1, the words:- impose an administrative fine or censure or.

SECTION 2. Subsection (a) of said section 204 of said chapter 110A, as so appearing, is hereby amended by striking out clauses (F) and (G) and inserting in place thereof the following two clauses:-

(F) is the subject of any of the following orders which are currently effective or which were issued within the last five years;

(i) 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 broker dealer, agent or investment advisor, or the substantial equivalent of those terms as defined in this chapter;

(ii) a suspension or expulsion from membership in an association with a self regulatory organization registered under the Securities Exchange Act of 1934 or the Commodities Exchange Act;

(iii) a United States Postal Service fraud order;

(iv) a cease and desist order entered after notice and opportunity for hearing by the secretary 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; or

(v) an order by the Commodity Futures Trading Commission denying, suspending, or revoking registration under the Commodity Exchange Act;

(G) has engaged in any unethical or dishonest conduct or practices in the securities, commodities or insurance business.

SECTION 3. Section 407A of said chapter 110A, as so appearing, is hereby amended by striking out the caption preceding said section and inserting in place thereof the following caption:-

Violations; Cease and Desist Orders; Costs.

SECTION 4. Said section 407A of said chapter 110A, as so appearing, is hereby amended by striking out subsection (a) and inserting in place thereof the following subsection:-

(a) If the secretary determines, after notice and opportunity for hearing, that any person has engaged in or is about to engage in any act or practice constituting a violation of any provision of this chapter or any rule or order issued thereunder, he may order such person to cease and desist from such unlawful act or practice and may take such affirmative action, including the imposition of an administrative fine, the issuance of an order for an accounting, disgorgement or rescission or any other such relief as in his judgment may be necessary to carry out the purposes of this chapter. No administrative fine imposed pursuant to this chapter shall exceed ten thousand dollars for each violation.

SECTION 5. Said section 407A of said chapter 110A, as so appearing, is hereby further amended by adding the following subsection:-

(d) a registrant, applicant for registration, issuer or other person upon whom the secretary has conducted an examination, audit, investigation or adjudicatory proceeding who has been found to have violated the provisions of this chapter shall pay for all the costs incurred in the conduct of such examination, audit, investigation or proceeding. Such costs shall include, but not be limited to, the salaries and other compensation paid to clerical, administrative, investigative and legal personnel of the secretary in the conduct of such examination, audit, investigation or adjudicatory proceeding.

SECTION 6. Section 408 of said chapter 110A, as so appearing, is hereby amended by striking out the second sentence and inserting in place thereof the following sentence:- Upon a proper showing, the court may grant a preliminary or permanent injunction or a temporary restraining order and may order an accounting, disgorgement, rescission and such other relief as may be in the public interest, including but not limited to the appointment of a receiver or conservator for the defendant or the defendant's assets.

SECTION 7. Subsection (e) of section 410 of said chapter 110A, as so appearing, is hereby amended by striking out the first sentence and inserting in place thereof the following sentence:- No person may sue under this section more than four years after the discovery by the person bringing the action of a violation of this chapter or any rule promulgated or order issued thereunder.