Antifraud Provisions
Apply to every security and every transaction, registered or exempt.
What is Antifraud Provisions?
It is unlawful, in connection with the offer, sale, or purchase of any security, to use any scheme to defraud, make an untrue statement of a material fact or omit one needed to keep statements from being misleading, or engage in any practice that operates as a fraud. For advisers, it is also unlawful to engage in any practice that deceives a client. No exemption - of the security, the transaction, or the person - escapes these provisions.
Antifraud Provisions: a worked example
Misstating a municipal bond's rating is fraud even though the bond is an exempt security sold in an exempt transaction.
More terms in Uniform Securities Act & Registration
Uniform Securities Act (USA)
The model state securities law most states' 'blue sky' statutes are based on.
State Securities Administrator
The official or agency that enforces a state's securities act.
Person (USA Definition)
Anyone who can be held legally responsible - individuals and organizations.
Investment Adviser (USA Definition)
Advises on securities, as a business, for compensation.
Excluded from the Investment Adviser Definition
Banks, incidental professionals, broker-dealers, and publishers are not advisers at all.
Exemptions from State Adviser Registration
An adviser with no office in the state and only institutional or very few clients there.
De Minimis Exemption
No place of business in the state and fewer than 6 clients there in 12 months.
Federal Covered Adviser
An adviser registered with the SEC rather than the states.
All Uniform Securities Act & Registration terms · Full glossary