Indiana Code 23-19-6-1. Securities division; securities commissioner; unlawful use of nonpublic information; investor education initiatives; securities division enforcement account; securities restitution fund; assistance from attorney general; polic…
(b) The secretary of state:
Terms Used In Indiana Code 23-19-6-1
- Appropriation: The provision of funds, through an annual appropriations act or a permanent law, for federal agencies to make payments out of the Treasury for specified purposes. The formal federal spending process consists of two sequential steps: authorization
- Attorney: includes a counselor or other person authorized to appear and represent a party in an action or special proceeding. See Indiana Code 1-1-4-5
- Commissioner: means the securities commissioner appointed under IC 23-19-6-1(a). See Indiana Code 23-19-1-2
- Common law: The legal system that originated in England and is now in use in the United States. It is based on judicial decisions rather than legislative action.
- Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
- Fraud: Intentional deception resulting in injury to another.
- Judgment: means all final orders, decrees, and determinations in an action and all orders upon which executions may issue. See Indiana Code 1-1-4-5
- Person: means an individual; corporation; business trust; estate; trust; partnership; limited liability company; association; joint venture; government; governmental subdivision, agency, or instrumentality; public corporation; or any other legal or commercial entity. See Indiana Code 23-19-1-2
- Restitution: The court-ordered payment of money by the defendant to the victim for damages caused by the criminal action.
- Sale: includes every contract of sale, contract to sell, or disposition of a security or interest in a security for value, and "offer to sell" includes every attempt or offer to dispose of, or solicitation of an offer to purchase, a security or interest in a security for value. See Indiana Code 23-19-1-2
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- State: means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States. See Indiana Code 23-19-1-2
- Statute: A law passed by a legislature.
(2) shall fix their compensation with the approval of the budget agency.
(c) It is unlawful for the commissioner or an officer, employee, or designee of the commissioner to use for personal benefit or the benefit of others records or other information obtained by or filed with the commissioner that is not public under section 7(b) of this chapter. This article does not authorize the commissioner or an officer, employee, or designee of the commissioner to disclose the record or information, except in accordance with section 2, 7(c), or 8 of this chapter.
(d) This article does not create or diminish a privilege or exemption that exists at common law, by statute or rule, or otherwise.
(e) Subject to IC 4-2-6-15, the commissioner may develop and implement investor education initiatives to inform the public about investing in securities, with particular emphasis on the prevention and detection of securities fraud. In developing and implementing these initiatives, the commissioner may collaborate with public and nonprofit organizations with an interest in investor education. The commissioner may accept a grant or donation from a person that is not affiliated with the securities industry or from a nonprofit organization, regardless of whether the organization is affiliated with the securities industry, to develop and implement investor education initiatives. This subsection does not authorize the commissioner to require participation or monetary contributions of a registrant in an investor education program.
(f) The securities division enforcement account is established. Except as provided in subsection (o), fees and funds of whatever character accruing from the administration of this article shall be accounted for by the secretary of state and shall be deposited with the treasurer of state to be deposited by the treasurer of the state in either the state general fund or the securities division enforcement account. Subject to IC 4-2-6-15, expenses incurred in the administration of this article shall be paid from the state general fund upon appropriation being made for the expenses in the manner provided by law for the making of those appropriations. The following shall be deposited by the treasurer of state in the securities division enforcement account:
(1) Grants and donations received under subsection (e).
(2) Costs of investigations recovered under section 4(e) of this chapter.
(3) Fifty percent (50%) of the first four million dollars ($4,000,000):
(A) of a civil penalty recovered under section 3(b) or 4(d) of this chapter;
(B) recovered in a settlement of an action initiated to enforce this article; or
(C) awarded as a judgment in an action to enforce this article.
(g) The following shall be deposited by the treasurer of state in the state general fund:
(1) Fifty percent (50%) of the first four million dollars ($4,000,000):
(A) of a civil penalty recovered under section 3(b) or 4(d) of this chapter;
(B) recovered in a settlement of an action initiated to enforce this article; or
(C) awarded as a judgment in an action to enforce this article.
(2) Any amount exceeding four million dollars ($4,000,000):
(A) of a civil penalty recovered under section 3(b) or 4(d) of this chapter;
(B) recovered in a settlement of an action initiated to enforce this article; or
(C) awarded as a judgment in an action to enforce this article.
(3) Subject to subsection (o), other fees and revenues that are not designated for deposit in the securities division enforcement account or the securities restitution fund.
(h) Notwithstanding IC 23-2-2.5-34, IC 23-2-2.5-43, IC 23-2.5-2, IC 23-19-4-12, IC 25-11-1-15, and this chapter, five percent (5%) of funds received for deposit in the securities division enforcement account shall instead be deposited in the securities restitution fund established by IC 23-20-1-25. Subject to IC 4-2-6-15, the funds deposited in the enforcement account shall be available, with the approval of the budget agency:
(1) to augment and supplement the funds appropriated for the administration of this article; and
(2) for grants and awards to nonprofit entities for programs and activities that will further investor education and financial literacy in the state.
The funds in the enforcement account do not revert to the state general fund at the end of any state fiscal year.
(i) In connection with the administration and enforcement of this article, the attorney general shall render all necessary assistance to the commissioner upon the commissioner’s request, and to that end, the attorney general shall employ legal and other professional services as are necessary to adequately and fully perform the service under the direction of the commissioner as the demands of the securities division shall require. Expenses incurred by the attorney general for the purposes stated in this subsection shall be chargeable against and paid out of funds appropriated to the attorney general for the administration of the attorney general’s office. The attorney general may authorize the commissioner and the commissioner’s designee to represent the commissioner and the securities division in any proceeding involving enforcement or defense of this article.
(j) Neither the secretary of state, the commissioner, nor an employee of the securities division shall be liable in their individual capacity, except to the state, for an act done or omitted in connection with the performance of their respective duties under this article.
(k) The commissioner shall take, prescribe, and file the oath of office prescribed by law. The commissioner, chief deputy commissioner, and each attorney or investigator designated by the commissioner are police officers of the state and shall have all the powers and duties of police officers in making arrests for violations of this article, or in serving any process, notice, or order connected with the enforcement of this article by whatever officer, authority, or court issued and shall comprise the enforcement department of the division and are considered a criminal justice agency for purposes of IC 5-2-4 and IC 10-13-3.
(l) The provisions of this article delegating and granting power to the secretary of state, the securities division, and the commissioner shall be liberally construed to the end that:
(1) the practice or commission of fraud may be prohibited and prevented;
(2) disclosure of sufficient and reliable information in order to afford reasonable opportunity for the exercise of independent judgment of the persons involved may be assured; and
(3) the qualifications may be prescribed to assure availability of reliable broker-dealers, investment advisers, and agents engaged in and in connection with the issuance, barter, sale, purchase, transfer, or disposition of securities in this state.
It is the intent and purpose of this article to delegate and grant to and vest in the secretary of state, the securities division, and the commissioner full and complete power to carry into effect and accomplish the purpose of this article and to charge them with full and complete responsibility for its effective administration.
(m) Copies of any statement and documents filed in the office of the secretary of state and of any records of the secretary of state certified by the commissioner shall be admissible in any prosecution, action, suit, or proceeding based upon, arising out of, or under this article to the same effect as the original of such statement, document, or record would be if actually produced.
(n) IC 4-21.5 and any rules of practice adopted by the securities division are applicable to administrative proceedings under this article.
(o) Notwithstanding any other law, two percent (2%) of funds received for deposit in the state general fund as described in subsection (g)(3) shall instead be deposited in the securities restitution fund established by IC 23-20-1-25.
As added by P.L.27-2007, SEC.23. Amended by P.L.114-2010, SEC.10; P.L.85-2012, SEC.4; P.L.92-2013, SEC.80; P.L.205-2013, SEC.338; P.L.2-2014, SEC.103; P.L.160-2015, SEC.6; P.L.39-2016, SEC.2; P.L.175-2019, SEC.3; P.L.156-2023, SEC.13.