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Chapter 409

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  409.6-604.  Administrative enforcement. — (a)  If the commissioner determines that a person has engaged, is engaging, or is about to engage in an act, practice, or course of business constituting a violation of this act or a rule adopted or order issued under this act or that a person has materially aided, is materially aiding, or is about to materially aid an act, practice, or course of business constituting a violation of this act or a rule adopted or order issued under this act, the commissioner may:

  (1)  Issue an order directing the person to cease and desist from engaging in the act, practice, or course of business or to take other action necessary or appropriate to comply with this act;

  (2)  Issue an order denying, suspending, revoking, or conditioning the exemptions for a broker-dealer under section 409.4-401(b)(1)(D) or (F) or an investment adviser under section 409.4-403(b)(1)(C); or

  (3)  Issue an order under section 409.2-204.

  (b)  An order under subsection (a) is effective on the date of issuance. Upon issuance of the order, the commissioner shall promptly serve each person subject to the order with a copy of the order and a notice that the order has been entered.  The order must include a statement whether the commissioner will seek a civil penalty or costs of the investigation, a statement of the reasons for the order, and notice that, within fifteen days after receipt of a request in a record from the person, the matter will be scheduled for a hearing.  If a person subject to the order does not request a hearing and none is ordered by the commissioner within thirty days after the date of service of the order, the order becomes final as to that person by operation of law.  If a hearing is requested or ordered, the commissioner, after notice of and opportunity for hearing to each person subject to the order, may modify or vacate the order or extend it until final determination.

  (c)  If a hearing is requested or ordered pursuant to subsection (b), a hearing before the commissioner must be provided.  A final order may not be issued unless the commissioner makes findings of fact and conclusions of law in a record in accordance with the provisions of chapter 536 and procedural rules promulgated by the commissioner.  The final order may make final, vacate, or modify the order issued under subsection (a).

  (d)  In a final order under subsection (c), the commissioner may:

  (1)  Impose a civil penalty up to twenty-five thousand dollars for each violation;

  (2)  Order a person subject to the order to pay restitution for any loss, including the amount of any actual damages that may have been caused by the conduct and interest at the rate of eight percent per year from the date of the violation causing the loss or disgorge any profits arising from the violation;

  (3)  In addition to any civil penalty otherwise provided by law, impose an additional civil penalty not to exceed fifteen thousand dollars for each such violation if the commissioner finds that a person subject to the order has violated any provision of this act and that such violation was committed against an elderly or disabled person.  For purposes of this section, the following terms mean:

  (A)  "Disabled person", a person with a physical or mental impairment that substantially limits one or more of the major life activities of such individual, a record of such impairment, or being regarded as having such an impairment;

  (B)  "Elderly person", a person sixty years of age or older.

  (e)  In a final order, the commissioner may charge the actual cost of an investigation or proceeding for a violation of this act or a rule adopted or order issued under this act.  These funds may be paid into the investor education and protection fund.

  (f)  If a petition for judicial review of a final order is not filed in accordance with section 409.6-609, the commissioner may file a certified copy of the final order with the clerk of a court of competent jurisdiction.  The order so filed has the same effect as a judgment of the court and may be recorded, enforced, or satisfied in the same manner as a judgment of the court.

  (g)  If a person does not comply with an order under this section, the commissioner may petition a court of competent jurisdiction to enforce the order.  The court may not require the commissioner to post a bond in an action or proceeding under this section.  If the court finds, after service and opportunity for hearing, that the person was not in compliance with the order, the court may adjudge the person in civil contempt of the order.  The court may impose a further civil penalty against the person for contempt in an amount not less than five thousand dollars but not greater than one hundred thousand dollars for each violation and may grant any other relief the court determines is just and proper in the circumstances.

  (h)  The commissioner is authorized to issue administrative consent orders in the settlement of any proceeding in the public interest under this act.


(L. 2003 H.B. 380, A.L. 2009 H.B. 62, A.L. 2020 S.B. 599)

---- end of effective  28 Aug 2020 ----

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Effective End
409.6-604 8/28/2020
409.6-604 8/28/2009 8/28/2020
409.6-604 9/1/2003 8/28/2009

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