KRS § 292.500 — KY Code / Title XXV / Chapter 292 / Section 292.500
292.500 Administration of chapter
Status: repealed

292.500 Administration of chapter.

(1) The administration of the provisions of this chapter shall be under the Department

of Financial Institutions.

(2) It is unlawful for the commissioner or any of his or her officers or employees to use

for personal benefit any information which is filed with or obtained by the

commissioner and which is not made public. Except as provided in subsection (19)

of this section, no provision of this chapter authorizes the commissioner or any of

the department's officers or employees to disclose any confidential information

except among themselves or when necessary or appropriate in an administrative

hearing or investigation under this chapter. No provision of this chapter either

creates or derogates from any privilege which exists at common law or otherwise

when documentary or other evidence is sought under a subpoena directed to the

commissioner or any of the department's officers or employees.

(3) The commissioner may promulgate, amend, and repeal administrative regulations,

forms, and orders as are necessary to carry out the provisions of this chapter,

including administrative regulations and forms governing registration statements,

applications, notice filings, and reports and defining any terms, whether or not used

in this chapter, insofar as the definitions are not inconsistent with the provisions of

this chapter. For the purpose of administrative regulations and forms, the

commissioner may classify securities, persons, and matters within his jurisdiction,

and prescribe different requirements for different classes.

(4) No administrative regulation, form, or order may be promulgated, amended, or

repealed unless the commissioner finds that the action is necessary or appropriate in

the public interest or for the protection of investors and consistent with the purposes

fairly intended by the policy and provision of this chapter. In promulgating

administrative regulations and forms, the commissioner may cooperate with the

securities administrators of the other states and the Securities and Exchange

Commission with a view to effectuating the policy of this statute to achieve

maximum uniformity in the form and content of registration statement, applications,

notice filings, and reports whenever practicable.

(5) The commissioner may by administrative regulation or order prescribe the form and

content of financial statements required under this chapter and the circumstances

under which consolidated financial statements shall be certified by certified public

accountants. All financial statements shall be prepared in accordance with generally

accepted accounting standards.

(6) All administrative regulations and forms of the commissioner shall be published.

(7) No provision of this chapter imposing any liability applies to any act done or

omitted in good faith in conformity with any administrative regulation, form, or

order of the commissioner, notwithstanding that the administrative regulation, form,

or order may later be amended or repealed or be determined by judicial or other

authority to be invalid for any reason.

(8) A document is filed when it is received by the commissioner or when the

commissioner receives confirmation that a document has been filed. The

commissioner may accept electronic filings of any documents required to be filed

under this chapter, either in conjunction with paper filings or in place of paper

filings in whole or in part.

(9) Every administrative hearing shall be conducted in accordance with KRS Chapter

13B and the provisions of this chapter, and shall be public unless the commissioner

in his discretion grants a request joined in by all the respondents that the hearing be

conducted privately.

(10) The commissioner shall keep a record of all applications for registration and

registration statements and notice filings which are or have been effective under this

chapter and a record of all denial, suspension, or revocation final orders which have

been entered under this chapter.

(11) The information contained in or filed with any registration statement, application, or

notice filing is a public record subject to the provisions of the Kentucky Open

Records Act.

(12) Upon request and at reasonable charges as the commissioner prescribes, the

commissioner shall furnish to any person photostatic or other copies (certified under

his seal of office if requested) of any entry in the register or any document which is

a matter of public record. In any administrative hearing or prosecution under this

chapter, any copy so certified is prima facie evidence of the contents of the entry or

document certified.

(13) The commissioner in his or her discretion may honor requests from interested

persons for interpretative opinions.

(14) The commissioner may impose civil fines against any person who violates any

provision of this chapter or any rule or order or voluntary agreement entered into

under this chapter. The fine shall not exceed twenty thousand dollars ($20,000) per

violation, except when the violation is directed at or results in monetary damage to

one (1) or more individuals who are sixty (60) years of age or older, the

commissioner may impose an additional fine not to exceed twenty thousand dollars

($20,000) per violation. Each act or transaction which violates this chapter or

administrative regulation, or orders or agreements entered into under this chapter,

shall constitute a separate violation. Any employer or principal shall be jointly and

severally liable for fines imposed in connection with the conduct of employees or

agents.

(15) The commissioner is authorized to designate that the fines imposed for violations of

this chapter or administrative regulation, or any order or voluntary agreement

entered into pursuant to this chapter, be deposited into the securities fraud

prosecution and prevention fund established in KRS 292.322.

(16) In addition to any fines imposed under subsection (14) of this section, the

commissioner may also assess the costs of any investigation, including attorney's

fees incurred as a result of bringing enforcement actions under the provisions of this

chapter and costs of holding any hearing as a result of an enforcement action. Costs

and attorney's fees may only be imposed if there has been a final determination that

a violation has occurred, and in an amount reasonably related to the costs of

investigation and enforcement for those violations only. Costs and attorney's fees

may be included as part of an agreement in settlement of an enforcement action.

(17) If fines, fees, or costs imposed under this section are not paid, then the

commissioner may notify the Department of Revenue, which may institute an action

in the name of the Commonwealth of Kentucky in the Franklin Circuit Court, or any

other court of competent jurisdiction, for the recovery of the fines, fees, or costs.

(18) The remedies provided by this section are not exclusive and may be sought and

employed in any combination to enforce the provisions of this chapter. The

remedies set forth in this section shall not prohibit or restrict the commissioner from

participating in any way whatsoever with respect to any joint examination,

investigation, enforcement action, settlement, or other legal or regulatory action

with securities administrators of other jurisdictions, the Securities and Exchange

Commission, any self-regulatory organization, or any national securities exchange

or national securities association registered under the Securities Exchange Act of

1934, 15 U.S.C. secs. 78a et seq. Accordingly, the commissioner may, at any time

and in his or her sole discretion, share or cause to be shared by any employee of the

department any information gained pursuant to an examination, investigation, filing,

or from any other source, with other governmental agencies, jurisdictions, or

governmental or self-regulating organizations or entities, to the extent the

commissioner, in his or her sole discretion, deems that the sharing of information is

or will be reasonably necessary or useful to the department or other agency in

carrying out its regulatory responsibilities.

(19) The following materials, documentation, and other information are deemed to have

been confidentially disclosed to the department and to be confidential information

under the Kentucky Open Records Act and, specifically, the provisions of KRS

61.878(1)(b), to the extent described in this subsection and except as provided

further in administrative regulation:

(a) Any materials, documentation, or other information provided to or otherwise

obtained by the department during the course of a routine compliance

examination of any broker-dealer, agent, investment adviser, or investment

adviser representative;

(b) Any materials, documentation, or other information that is part of an ongoing

investigation; and

(c) Any materials, documentation, or other information provided to or otherwise

obtained by the department from any other regulatory or governmental body,

including but not limited to any other state securities regulator, the Securities

and Exchange Commission, any self-regulatory organization, any state or

federal criminal agency, and any criminal prosecutorial body, and which the

other body expressly deems to be confidential.

(20) (a) The confidential information specified in subsection (19)(a) and (b) of this

section may be released when required in a proper legal proceeding in which a

subpoena and protective order ensuring confidentiality has been issued by the

tribunal.

(b) The confidential information specified in subsection (19)(c) of this section

must be obtained from the entity which provided the information.