§ 502.411 — Postregistration requirements

Iowa § 502.411

• Jurisdiction: Iowa
• Title XII: BUSINESS ENTITIES
• Ch. 502: UNIFORM SECURITIES ACT (BLUE SKY LAW)

Text

1. Financial requirements. Subject to section 15(h) of the Securities Exchange Act of
1934, 15 U.S.C. §78o(h), or section 222 of the Investment Advisers Act of 1940, 15 U.S.C.
§80b-22, a rule adopted or order issued under this chapter may establish minimum financial
requirements for broker-dealers registered or required to be registered under this chapter
and investment advisers registered or required to be registered under this chapter.
2. Financial reports. Subject to section 15(h) of the Securities Exchange Act of 1934,
15 U.S.C. §78o(h), or section 222(b) of the Investment Advisers Act of 1940, 15 U.S.C.
§80b-22, a broker-dealer registered or required to be registered under this chapter and an
investment adviser registered or required to be registered under this chapter shall file such
financial reports as are required by a rule adopted or order issued under this chapter. If the
information contained in a record filed under this subsection is or becomes inaccurate or
incomplete in a material respect, the registrant shall promptly file a correcting amendment.
The administrator may, by rule, assess a reasonable charge for the late filing of a financial
report under this subsection.
3. Recordkeeping. Subject to section 15(h) of the Securities Exchange Act of 1934, 15
U.S.C. §78o(h), or section 222 of the Investment Advisers Act of 1940, 15 U.S.C. §80b-22, all
of the following apply:
a. A broker-dealer registered or required to be registered under this chapter and an
investment adviser registered or required to be registered under this chapter shall make
and maintain the accounts, correspondence, memoranda, papers, books, and other records
required by rule adopted or order issued under this chapter.
39 UNIFORM SECURITIES ACT (BLUE SKY LAW), §502.412
b. Broker-dealer records required to be maintained under paragraph “a” may be
maintained in any form of data storage acceptable under section 17(a) of the Securities
Exchange Act of 1934, 15 U.S.C. §78q(a), if they are readily accessible to the administrator.
c. Investment adviser records required to be maintained under paragraph “a” may be
maintained in any form of data storage required by rule adopted or order issued under this
chapter.
4. Audits or inspections. The records of a broker-dealer registered or required to be
registered under this chapter and of an investment adviser registered or required to be
registered under this chapter are subject to such reasonable periodic, special, or other
audits or inspections by a representative of the administrator, within or without this state,
as the administrator considers necessary or appropriate in the public interest and for the
protection of investors. An audit or inspection may be made at any time and without prior
notice. The administrator may copy, and remove for audit or inspection copies of, all records
the administrator reasonably considers necessary or appropriate to conduct the audit or
inspection. The administrator may assess a reasonable charge for conducting an audit or
inspection under this subsection.
5. Custody and discretionary authority bond or insurance. Subject to section 15(h) of
the Securities Exchange Act of 1934, 15 U.S.C. §78o(h), or section 222 of the Investment
Advisers Act of 1940, 15 U.S.C. §80b-22, a rule adopted or order issued under this chapter
may require a broker-dealer or investment adviser that has custody of or discretionary
authority over funds or securities of a customer or client to obtain insurance or post a bond
or other satisfactory form of security in an amount the administrator shall prescribe. The
administrator may determine the requirements of the insurance, bond, or other satisfactory
form of security. Insurance or a bond or other satisfactory form of security shall not be
required of a broker-dealer registered under this chapter whose net capital exceeds, or of
an investment adviser registered under this chapter whose minimum financial requirements
exceed, the amounts required by rule or order under this chapter. The insurance, bond, or
other satisfactory form of security must permit an action by a person to enforce any liability
on the insurance, bond, or other satisfactory form of security if instituted within the time
limitations in section 502.509, subsection 10, paragraph “b”.
6. Requirements for custody. Subject to section 15(h) of the Securities Exchange Act of
1934, 15 U.S.C. §78o(h), or section 222 of the Investment Advisers Act of 1940, 15 U.S.C.
§80b-22, an agent shall not have custody of funds or securities of a customer except under
the supervision of a broker-dealer and an investment adviser representative shall not have
custodyoffundsorsecuritiesofaclientexceptunderthesupervisionofaninvestmentadviser
or a federal covered investment adviser. A rule adopted or order issued under this chapter
may prohibit, limit, or impose conditions on a broker-dealer regarding custody of funds or
securitiesofacustomerandonaninvestmentadviserregardingcustodyofsecuritiesorfunds
of a client.
7. Investment adviser brochure rule. With respect to an investment adviser registered
or required to be registered under this chapter, a rule adopted or order issued under this
chapter may require that information or other records be furnished or disseminated to clients
or prospective clients in this state as necessary or appropriate in the public interest and for
the protection of investors and advisory clients.
8. Continuing education. A rule adopted or order issued under this chapter may require
an individual registered under section 502.402 or 502.404 to participate in a continuing
education program approved by the securities and exchange commission and administered
by a self-regulatory organization or, in the absence of such a program, a rule adopted
or order issued under this chapter may require continuing education for an individual
registered under section 502.404.