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What's New
- Coming Soon - New Franchise
Web Application!
Please note that in the fall of 2009 DFI plans to launch a
Franchise Registration website. At this website, customers
will be able to fill out their franchise registration application
information, upload their disclosure documents, and pay online.
This convenient option should save customers time and mailing
costs. For franchisors who are already saving electronic copies
of their disclosure documents to CD, the transition to filing
online should be even easier, since DFI will be accepting uploads
in the PDF format. Please check this website for ongoing updates.
- Securities Division Adopts Permanent Rules Effective April
1, 2009 That Prohibit Use of Misleading Senior Designations/Certifications
Permanent rules became effective April 1, 2009 to protect seniors
in Wisconsin from being misled through the use by securities licensees
of designations and credentials that imply or represent that a person
has special expertise, certification, or training in financial planning
for seniors, but where such designations and/or credentials are either
non-existent or do not involve significant education, testing, training
or experience, and in reality are marketing ploys.
The permanent rules supersede emergency rules adopted in September
2008 on the subject.
The Division's rulemaking is based on a “Model Rule On The
Use of Senior-Specific Certifications and Professional Designations,” developed
by the North American Securities Administrators Association, Inc.
("NASAA Model Rule"), and adopted by the NASAA membership,
including Wisconsin, on March 20, 2008. The Wisconsin rule-making
involved amending the list of “dishonest or unethical business
practice” provisions applicable to broker-dealers, agents,
investment advisers and their representatives to provide that the
misleading use by licensees of senior designations or certifications
-- as particularized in the rules -- can be a basis for denial,
suspension or revocation of a license.
The NASAA Model Rule adopted in Wisconsin covers a broad
array of practices. It prohibits licensees from using any non-existent
or self-conferred certification. Also prohibited would be any designation
that "indicates or implies a level of occupational qualification
obtained through education, training, or experience" that
the person doesn't actually have. Furthermore, the rule
would
disallow designations obtained from organizations that are "primarily
engaged in the business of instruction in sales and/or marketing.” Additionally,
reasonable standards for competency would be required, along with
monitoring designees and minimum continuing-education standards.
- Securities Division Adopts For January
1, 2009 Effectiveness, Final, Permanent Rules Relating to 2008
Rules Revision
Permanent rules adopted by the Division relating to its 2008 Rules
Revision completed the required printing and publication process
and became effective on January 1, 2009. The majority of the proposed
revisions were adopted to implement, and to become effective concurrently
with, the new repealed and re-created Wisconsin Uniform Securities
Law, based on the 2002 Revised Uniform Securities Act contained in
2007 Wisconsin Act 196. [See related story below.]
The rule changes involve all aspects of Wisconsin securities regulation
(definitions, securities registration procedures and registration
exemptions, securities broker-dealer and investment adviser registration,
enforcement powers and procedures, as well as general administrative
powers). Also included in the Division’s 2008 Rules Revision
are several revisions that make certain existing Wisconsin Franchise
Rules establishing requirements for disclosure documents used in
connection with the offer and sale of franchises to persons in Wisconsin,
consistent with a recent Federal Trade Commission Franchise Rule
on that subject.
The final form of the rules as adopted reflect modifications to
several provisions as result of public comment letters received
as well as hearing testimony. The attached line-and-strike version
of the final, adopted rules describes those modifications in the
Comment paragraphs following the individual rule provisions involved.
The final form of the adopted rules also reflects numerous technical,
non-substantive changes recommended by the Wisconsin Legislative
Council's Rules Clearinghouse.
- Revised Wisconsin Uniform Securities Law Enacted in Wisconsin
for January 1, 2009 Effectiveness
January 1, 2009 is the effective date of legislation in the form of 2007 Wisconsin
Act 196 that was signed by Governor James Doyle on March 27, 2008 to replace
the former Wisconsin Uniform Securities Law, adopted in 1970 (and based on
original Uniform Securities Act of 1956), with the updated and the modernized
Uniform Securities Act of 2002 (USA 2002) developed by the National Conference
of Commissioners
on Uniform State Laws (NCCUSL) following a several-year process of meetings
and deliberations.
The legislation adopts NCCUSL’s updated USA 2002, with certain modifications
recommended by the State Bar of Wisconsin's Uniform Securities Act Study Group
(which included several members of the Division of Securities of the Wisconsin
Department of Financial Institutions), following an extensive three-year review
process. The modifications principally consisted of adding to the USA 2002,
a number of provisions from the existing Wisconsin Securities Law that had
been developed over the years, and which the State Bar Study Group determined
were important to be preserved in the revised Wisconsin Securities Law.
Although there are no substantive new authorities provided, some changes
to be noted include: (i) authorizing new enforcement techniques relating
to asset freezes and rescission orders; (ii) expanding the Securities Division's
authority to assist securities regulators in other jurisdictions, including
seeking judicial enforcement of subpoenas; (iii) modifications to the statute
of limitations in civil liability court actions by aggrieved investors; (iv)
certain modifications of the definition of "security" with respect
to interests in limited liability companies, and specifically including limited
liability partnerships and viatical settlements of insurance contracts within
the definition; and (v) certain changes to the exclusion from the definition
of “broker-dealer” for banks and savings institutions to be consistent
with federal statutory language under the Gramm-Leach-Bliley Act of 1999.
- The Uniform Franchise Offering Circular has been superseded
and cannot be used after July 1, 2008
As of July 1, 2008, under the Federal Trade Commission’s
Amended FTC Franchise Rule (16 C.F.R. Part 436), all franchisors
must prepare and distribute disclosure documents that, at a minimum,
comply with the Amended FTC Franchise Rule’s disclosure format
[labeled the "Uniform Franchise Disclosure Document” (“UFDD”)].
Consequently, the Uniform Franchise Offering Circular [the “UFOC”,
as promulgated by the North American Securities Administrators
Association (“NASAA”)], that had been used since 1993
by most franchisors as the disclosure document in connection with
the offer and sale of franchises, cannot be used in Wisconsin or
any other state jurisdiction after July 1, 2008.
However, under the Amended FTC Franchise Rule, states may impose
additional disclosure requirements under state law consistent
with the Amended FTC Franchise Rule.
Using that ability to impose additional, not-inconsistent, state
requirements, NASAA developed (during 2007 and 2008) and adopted
in June 2008 for use by NASAA franchise jurisdictions, the disclosure
requirements of the Amended FTC Franchise Rule, with minimal
additional requirements, as the successor to the UFOC Guidelines.
A link to the NASAA-adopted Amended FTC Franchise Rule and Disclosure
Guidelines is provided in the Division’s Franchise-related
Website pages. The revised NASAA Franchise Registration and Disclosure
Guidelines thus replace as of July 1, 2008, the former NASAA
UFOC Guidelines. See the Division's Franchise Law related Website
pages for additional details.
- Wisconsin's 10-Business Day Requirement in 553.27(4)
To Provide a Disclosure Document To a Prospective Franchisee Is
Revised to Be Consistent With the FTC's New 14-Calendar Day Requirement
Legislation in 2007 Wisconsin Act 150 was enacted March 21, 2008
that revised the timing deadline under sec. 553.27(4) of the Wisconsin
Franchise Investment Law for providing franchise offering circulars
to prospective Wisconsin franchise purchasers. The revision [to a
14 (calendar) day deadline from the 10-business day deadline previously
required] was necessary to make the Wisconsin requirement consistent
with a change to the Federal Trade Commission's Franchise Rule requirement
on that subject that must be complied with nationally by all sellers
of franchises after July 1, 2008
- Public Alert: Unregistered Soliciting Entities
In
an effort to warn the public about these entities, the SEC is publishing
information it has learned in reviewing the complaints. For each of
the entities named on the list, SEC staff has determined either
- that there is no US registered securities firm with this
name, or
- that there is a US registered securities firm with
the same (or a similar) name but that solicitations appear
to have been
made by
persons who are not
affiliated with the US registered securities firm.
The SEC will regularly update this list. This list does not
include all unregistered entities or entities that have been the
subject of complaints received
by the SEC.
- Interest
on Free Credit Balances Available to Wisconsin Investors
- Online Broker-dealer
Guide now available.
Broker-dealers and their securities agents now have an online Guide
to all aspects of licensing and regulatory oversight in Wisconsin. Divided
into topics such as Applications, Recordkeeping, Examinations, Securities
Agents and more, readers can now find answers to questions related to
the initial licensing application process and the regulation of broker-dealers
and their securities agents plus links to all application forms and
licensing statutes and Administrative Code sections referred to in the
Guide.
Other Information
Securities and Franchising
Overview -- for a summary of the mission and activities
of DFI's Division of Securities
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