§ 37-5B-41 — Cease and desist orders.

The director, with or without prior notice or hearing, may issue a cease and desist order and may issue an order denying, suspending, or revoking any notice filing, amendment, or exemption if the director finds: (1) That the applicant, or franchisor or any officer, director, agent, or employee thereof or any other person has violated or failed to comply with any provision of this chapter or any rule or order of the director; (2) That the offer, sale, or purchase of the franchise would constitute misrepresentation to, or deceit or fraud upon, purchasers thereof, or has worked or tended to work a fraud upon purchasers or would so operate; (3) That the applicant, or franchisor or any officer, director, agent, or employee thereof or any other person is engaging or is about to engage in false, fraudulent, or deceptive practices in connection with the offer and sale of a franchise; (4) That any person identified in the disclosure document has been convicted of or had a civil judgment entered against him or her for fraud, theft, fraudulent conversion, restraint of trade, unfair or deceptive practices or misappropriation of property, or is subject to an order issued, after notice and opportunity for hearing, by a state or federal regulatory agency and the involvement of the person in the business of the applicant or franchisor creates a substantial risk to prospective franchisees; (5) That the financial condition of the franchisor adversely affects or would adversely affect the ability of the franchisor to fulfill its obligations under the franchise agreement; or (6) That the franchisor's enterprise or method of business includes or would include activities which are illegal where performed.

Legislative History

SL 2008, ch 203, § 41.