409.5-502. Prohibited conduct in providing investment advice.
Prohibited conduct in providing investment advice.
409.5-502. (a) It is unlawful for a person that advises others forcompensation, either directly or indirectly or through publications orwritings, as to the value of securities or the advisability of investingin, purchasing, or selling securities or that, for compensation and as partof a regular business, issues or promulgates analyses or reports relatingto securities:
(1) To employ a device, scheme, or artifice to defraud anotherperson; or
(2) To engage in an act, practice, or course of business thatoperates or would operate as a fraud or deceit upon another person.
(b) A rule adopted under this act may define an act, practice, orcourse of business of an investment adviser or an investment adviserrepresentative, other than a supervised person of a federal coveredinvestment adviser, as fraudulent, deceptive, or manipulative, andprescribe means reasonably designed to prevent investment advisers andinvestment adviser representatives, other than supervised persons of afederal covered investment adviser, from engaging in acts, practices, andcourses of business defined as fraudulent, deceptive, or manipulative.
(c) A rule adopted under this act may specify the contents of aninvestment advisory contract entered into, extended, or renewed by aninvestment adviser.
(L. 2003 H.B. 380)Effective 9-01-03