according to california law: he's in violation. but we knew that already. anyway, who cares? right? everyone gets the talking head they deserve, as we also know.
i won't bother with the federal law.
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Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit Sitka Pacific's Account Management Page to learn more about wealth management and capital preservation strategies of Sitka Pacific.
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Assembly Bill No. 2149
CHAPTER 476
An act to add Section 25243.5 to the Corporations Code, relating to
securities.
[Approved by Governor September 28, 2008. Filed with
Secretary of State September 28, 2008.]
legislative counsel’s digest
AB 2149, Berg. Broker-dealers and investment advisers.
Existing law, the Corporate Securities Law of 1968, provides for the
certification and regulation, by the Commissioner of Corporations, of
broker-dealers and investment advisers. Existing law also provides for the
regulation of broker-dealer agents and investment adviser representatives.
Existing law makes it unlawful for an investment adviser to, among other
things, defraud or engage in any transaction that operates as a fraud or deceit
upon any client or prospective client, or represent that he or she is an
investment counsel or to use the name “investment counsel” unless certain
requirements have been met. Existing law also makes it unlawful for a
broker-dealer or investment adviser to represent or imply that he or she has
been sponsored, recommended or approved by the commissioner, except
as specified. Under existing law, a violation of these provisions is a crime
and a violator is subject to specified penalties.
This bill would prohibit a broker-dealer or investment adviser, or an agent
or representative thereof, except as specified, from using a senior-specific
certification, credential, or professional designation indicating or implying
that he or she has a special certification or training in advising or servicing
senior citizens or retirees in such a way as to mislead any person. The bill
would make these provisions operative on July 1, 2009.
Because a violation of the bill’s provisions would be a crime, the bill
would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies
and school districts for certain costs mandated by the state. Statutory
provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for
a specified reason.
The people of the State of California do enact as follows:
SECTION 1. Section 25243.5 is added to the Corporations Code, to
read:
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25243.5. (a) A broker-dealer or investment adviser, or an agent or
representative thereof, shall not use a senior-specific certification, credential,
or professional designation in connection with the offer, sale, or purchase
of securities, or the provision of advice as to the value of or the advisability
of investing in, purchasing, or selling securities, either directly or indirectly
or through publications or writings or by issuing or promulgating analyses
or reports relating to securities, that indicates or implies that the
broker-dealer, investment adviser, or an agent or representative thereof, has
special certification or training in advising or servicing senior citizens or
retirees, in such a way as to mislead any person.
(b) The prohibited use of these certifications, credentials, or professional
designations includes, but is not limited to, the following:
(1) The use of a certification, credential, or professional designation by
a person who has not actually earned or is otherwise ineligible to use the
certification, credential, or designation.
(2) The use of a nonexistent or self-conferred certification, credential,
or professional designation.
(3) The use of a certification, credential, or professional designation that
indicates or implies a level of occupational qualifications obtained through
education, training, or experience that the person using the certification,
credential, or professional designation does not have.
(4) The use of a certification, credential, or professional designation that
was obtained from a designating, credentialing, or certifying organization
where any of the following apply:
(A) The organization is primarily engaged in the business of instruction
in sales marketing.
(B) The organization does not have reasonable standards or procedures
for assuring the competency of individuals to whom it grants a certification,
credential, or professional designation.
(C) The organization does not have reasonable standards or procedures
for monitoring and disciplining individuals with a certification, credential,
or professional designation for improper or unethical conduct.
(D) The organization does not have reasonable continuing education
requirements for individuals with a certification, credential, or professional
designation in order to maintain the certificate, credential, or professional
designation.
(c) There is a rebuttable presumption that a designating, credentialing,
or certifying organization is not disqualified solely for the purposes of
paragraph (4) of subdivision (b) when the organization has been accredited
by the American National Standards Institute, the National Commission for
Certifying Agencies, or an organization that is on the United States
Department of Education’s list entitled “Accrediting Agencies Recognized
for Title IV Purposes” and the certification, credential, or professional
designation issued therefrom does not primarily apply to sales and/or
marketing.
(d) In determining whether a combination of words, or an acronym
standing for a combination of words, constitutes a certification, credential,
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Ch. 476 — 2 —
or professional designation indicating or implying that a person has special
certification or training in advising or serving senior citizens or retirees,
factors to be considered shall include both of the following:
(1) Use of one or more word such as “senior,” “retirement,” “elder,” or
like words combined with one or more words such as “certified,”
“registered,” “chartered,” “adviser,” “specialist,” “consultant,” “planner,”
or like words, in the name of the certification, credential, or professional
designation or credential.
(2) The manner in which those words are combined.
(e) This section shall not apply to the use of a job title by a person within
an organization that is licensed or registered by the Department of
Corporations or a federal financial services regulatory agency, when that
job title indicates seniority or standing within the organization, or specifies
a person’s area of specialization within the organization. For the purposes
of this subdivision, federal financial services regulatory agency includes,
but is not limited to, an agency that regulates brokers or dealers, investment
advisers, or investment companies as described under the Investment
Company Act of 1940 (15 U.S.C. Sec. 809-1 et seq.).
(f) (1) This section shall not apply to a broker or agent who is licensed
by the Department of Insurance and is in compliance with the requirements
of Section 787.1 of the Insurance Code.
(2) This subdivision shall be operative only if Assembly Bill 2150 of the
2007–08 Regular Session is chaptered and becomes effective and that bill
adds Section 787.1 to the Insurance Code.
(g) This section shall become operative on July 1, 2009.
SEC. 2. No reimbursement is required by this act pursuant to Section 6
of Article XIII B of the California Constitution because the only costs that
may be incurred by a local agency or school district will be incurred because
this act creates a new crime or infraction, eliminates a crime or infraction,
or changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a crime
within the meaning of Section 6 of Article XIII B of the California
Constitution.
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