HS HB 492 -- SECURITIES REGULATIONS (Hosmer)

This substitute revises the securities regulation statutes.  In
its main provisions, the substitute:

(1)  Requires that the branch offices of broker-dealers or
investment advisers be registered in this state;

(2)  Clarifies that the Securities Commissioner may deny,
suspend, revoke, or cancel the application or registration of an
entity that willfully fails to furnish requested information
within 30 days of receipt of the notice;

(3)  Reduces the number of copies of the registration statement
required for securities registration purposes from 3 to one and
sets the renewal fee for most registrations at $100 for a one--
year period;

(4)  Expands the definition of "security" to include fractional
or pooled interest in a viatical settlement contract;

(5)  Allows the commissioner in the settlement of an
investigation of a security violation to receive various fines,
payments, and the cost of the investigation.  Under current law,
the commissioner could receive only any one of these to the
exclusion of the others;

(6)  Exempts generally internet solicitations not offered to
persons in this state from Missouri security regulations; and

(7)  Requires that the commissioner of securities appoint an
assistant commissioner.

FISCAL NOTE:  Estimated Net Effect on General Revenue Fund of $0
in FY 2000, FY 2001, and FY 2002.  Assuming the unknown costs
net to $0.

HB 492 -- SECURITIES REGULATIONS

CO-SPONSORS:  Hosmer, Smith, Gibbons

COMMITTEE ACTION:  Voted "do pass" by the Committee on Civil and
Administrative Law by a vote of 14 to 4.

This bill revises the securities regulation statutes.  In its
main provisions, the bill:

(1)  Requires that the branch offices of broker-dealers or
investment advisers be registered in this state;

(2)  Clarifies that the Securities Commissioner may deny,
suspend, revoke, or cancel the application or registration of an
entity that fails to furnish requested information within a
reasonable time as determined by the commissioner;

(3)  Reduces the number of copies of the registration statement
required for securities registration purposes from 3 to one and
sets the renewal fee for most registrations at $100 for a one--
year period;

(4)  Expands the definition of "security" to include fractional
or pooled interest in a viatical settlement contract;

(5)  Allows the commissioner in the settlement of an
investigation of a security violation to receive various fines,
payments, and the cost of the investigation.  Under current law,
the commissioner could receive only any one of these to the
exclusion of the others;

(6)  Exempts generally internet solicitations not offered to
persons in this state from Missouri security regulations;

(7)  Mandates that this state elect to retain the power to
require or not require registration of securities and the
handlers of the securities that are limited or exempted under
federal law as provided in the Philanthropy Protection Act of
1995;

(8)  Requires that the commissioner of securities appoint an
assistant commissioner; and,

(9)  Clarifies that commencement of appellate review of orders
of the Cole County circuit court does not operate as a stay of
the commissioner's order, but that Cole County circuit court
review of an administrative assessment by the commissioner does
operate as a stay of that assessment.

FISCAL NOTE:  Estimated Net Effect on General Revenue Fund of $0
in FY 2000, FY 2001, and FY 2002.  Assuming the unknown costs
net to $0.

PROPONENTS:  Supporters say that this bill eases the regulatory
burden for persons engaged in securities transactions, cleans up
outdated language in the existing law, and provides the division
with additional enforcement mechanisms to fight securities fraud.

Testifying for the bill were Representative Hosmer; Office of
the Secretary of State, Commissioner of Securities; Robert G.
Warner; Harry & Shirley Basore; Donald R. Penrod; Janice N.
Graves; and Bernard & Gale Rettman.

OPPONENTS:  Those who oppose the bill say that the expanded
enforcement provisions are too broad and violate due process
rights, and the provisions regulating viatical settlements go
too far, as well.

Testifying against the bill were the Missouri Securities
Industry Association; Association of Life Underwriters; and
Viatical Settlements, Inc.

Julie Jinkens McNitt, Legislative Analyst

HB 492 -- Securities Regulations

Co-Sponsors:  Hosmer, Smith, Gibbons

This bill revises the securities regulation statutes.  In its
main provisions, the bill:

(1)  Requires that the branch offices of broker-dealers or
investment advisers be registered in this state;

(2)  Clarifies that the Securities Commissioner may deny,
suspend, revoke, or cancel the application or registration of an
entity that fails to furnish requested information within a
reasonable time as determined by the commissioner;

(3)  Reduces the number of copies of the registration statement
required for securities registration purposes from 3 to one and
sets the renewal fee for most registrations at $100 for a one--
year period;

(4)  Expands the definition of "security" to include fractional
or pooled interest in a viatical settlement contract;

(5)  Allows the commissioner in the settlement of an
investigation of a security violation to receive various fines,
payments, and the cost of the investigation.  Under current law,
the commissioner could receive only any one of these to the
exclusion of the others;

(6)  Exempts generally internet solicitations not offered to
persons in this state from Missouri security regulations;

(7)  Mandates that this state elect to retain the power to
require or not require registration of securities and the
handlers of the securities that are limited or exempted under
federal law as provided in the Philanthropy Protection Act of
1995;

(8)  Requires that the commissioner of securities appoint an
assistant commissioner; and,

(9)  Clarifies that commencement of appellate review of orders
of the Cole County circuit court does not operate as a stay of
the commissioner's order, but that Cole County circuit court
review of an administrative assessment by the commissioner does
operate as a stay of that assessment.