reglab/statecodes huggingface dataset:
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-2082 - Requirements for securities fraud actions involving misleading statements or omissions

44-2082.
Requirements for securities fraud actions involving misleading statements or omissions
A. In any private action arising under section 44-1991 or 44-1992 in which the plaintiff alleges that the defendant made an untrue statement of a material fact or omitted a statement of a material fact necessary in order to make the statements made,  in the light of the circumstances in which they were made,  not misleading,  the complaint shall specify each alleged untrue statement or material omission and the reason or reasons why the statement or omission is misleading or the omission is material and,  if an allegation regarding the statement or omission is made on information and belief,  the complaint shall state with particularity all facts on which that belief is formed.
B. In any private action arising under section 44-1991 or 44-1992 in which the plaintiff may recover money damages only on proof that the defendant acted with a particular state of mind,  for each act or omission that allegedly violates section 44-1991 or 44-1992,  the complaint shall state with particularity facts giving rise to a strong inference that the defendant acted with the required state of mind.
C. In any private action arising under section 44-1991 or 44-1992:
1. On any defendant's motion,  the court shall dismiss the complaint if the requirements of subsections A and B of this section are not met.
2. All discovery and other proceedings shall be stayed during the pendency of any motion to dismiss pursuant to rule 12 of the Arizona rules of civil procedure,  unless the court finds on the motion of any party that particularized discovery is necessary to preserve evidence or to prevent undue prejudice to that party.
D. During the pendency of any stay of discovery pursuant to subsection C of this section,  unless ordered by the court,  any party to the action with actual notice of the allegations contained in the complaint shall treat all documents,  data compilations,  including electronically recorded or stored data,  and tangible objects that are in the custody or control of that person and that are relevant to the allegations as if they were the subject of a continuing request for production of documents from an opposing party under the Arizona rules of civil procedure or any applicable federal or other jurisdictional counterpart to the rules. A party aggrieved by the wilful failure of an opposing party to comply with this subsection may apply to the court for an order awarding appropriate sanctions.
E. Except as provided in section 44-1991,  subsection B,  including actions based on allegations of activities constituting dishonest or unethical practices in the securities industry,  in any private action arising under this chapter,  the plaintiff has the burden of proving that the act or omission of the defendant alleged to violate the section under which the private action is brought caused the loss for which the plaintiff seeks to recover damages.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-2083 - Sanctions for abusive litigation

44-2083.
Sanctions for abusive litigation
A. In any private action arising under this chapter,  on final adjudication of the action,  unless the parties stipulate otherwise,  the court shall include in the record specific findings regarding compliance by each party and each attorney representing any party with each requirement of rule 11(b) of the Arizona rules of civil procedure or any applicable federal or other jurisdictional counterpart to the rules as to any complaint,  responsive pleading or dispositive motion. If the federal or other jurisdictional rules of civil procedure do not have a counterpart to rule 11(b) of the Arizona rules of civil procedure,  rule 11(b) of the Arizona rules of civil procedure applies.
B. If the court makes a finding under subsection A that a party or attorney violated any requirement of rule 11(b) of the Arizona rules of civil procedure or any federal or other jurisdictional counterpart to the rules as to any complaint,  responsive pleading or dispositive motion,  the court shall impose sanctions on that party or attorney in accordance with rule 11 of the Arizona rules of civil procedure or any federal or other jurisdictional counterpart to the rules. Before making a finding that any party or attorney has violated the applicable rules,  the court shall give that party or attorney notice and an opportunity to respond.
C. Subject to subsections D and E,  for the purposes of subsection B,  the court shall adopt a presumption that the appropriate sanctions for:
1. Failure of any responsive pleading or dispositive motion to comply with any requirement of rule 11(b) of the Arizona rules of civil procedure or any applicable federal or other jurisdictional counterpart to the rules is an award to the opposing party of reasonable attorney fees and other expenses incurred as a direct result of the violation.
2. Substantial failure of any complaint to comply with any requirement of rule 11(b) of the Arizona rules of civil procedure or any federal or other jurisdictional counterpart to the rules is an award to the opposing party of reasonable attorney fees and other expenses incurred in the action.
D. The presumption prescribed in subsection C may be rebutted only on proof by the party or attorney against whom sanctions are to be imposed that either of the following applies:
1. The award of attorney fees and other expenses will impose an unreasonable burden on that party or attorney and would be unjust,  and the failure to make an award would not impose a greater burden on the party in whose favor sanctions are to be imposed.
2. The violation of rule 11(b) of the Arizona rules of civil procedure or federal or other jurisdictional counterpart to the rules was de minimis.
E. If the party or attorney against whom sanctions are to be imposed meets the burden prescribed by subsection D,  the court shall award the sanctions that the court deems appropriate pursuant to rule 11 of the Arizona rules of civil procedure or any applicable federal or other jurisdictional counterpart to the rules.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-2084 - Right to written interrogatories

44-2084.
Right to written interrogatories
In any private action arising under this chapter in which the plaintiff may recover money damages,  if requested by a defendant,  the court shall submit to the jury a written interrogatory on the issue of each defendant's state of mind at the time of the alleged violation.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-2085 - Limitation on damages; definition

44-2085.
Limitation on damages;  definition
A. Except as provided in subsection B of this section,  in any private action arising under section 44-1991 or 44-1992 in which the plaintiff seeks to establish damages by reference to the market price of a security,  the award of damages to the plaintiff shall not exceed the difference between the purchase or sale price paid or received,  as appropriate,  by the plaintiff for the security and the mean trading price of that security during the ninety days beginning on the date on which the information correcting the misstatement or omission that is the basis for the action is disseminated to the market.
B. In any private action arising under section 44-1991 or 44-1992 in which the plaintiff seeks to establish damages by reference to the market price of a security,  if the plaintiff sells or repurchases the security before the expiration of the ninety day period prescribed in subsection A of this section,  the plaintiff's damages shall not exceed the difference between the purchase or sale price paid or received by the plaintiff for the security and the mean trading price of the security during the period beginning immediately after dissemination of information correcting the misstatement or omission and ending on the date on which the plaintiff sells or repurchases the security.
C. This section shall not apply to damages caused by a violation of section 44-1841 or 44-1842.
D. For purposes of this section,  " mean trading price of the security"  means an average of the daily trading price of that security,  determined as of the close of the market each day during the relevant period.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-2086 - Attorney fees paid from disgorgement monies; prohibition

44-2086.
Attorney fees paid from disgorgement monies;  prohibition
Disgorged monies resulting from a judicial or administrative action brought by the commission shall not be distributed as payment for attorney fees or expenses incurred by private parties seeking distribution of the disgorged monies,  except as otherwise ordered by the court on a motion by the commission or,  in the case of an administrative action,  as otherwise ordered by the commission.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-2122 - Audit requirements

44-2122.
Audit requirements
Unless exempted by the commission,  an independent certified public accountant who audits the financial statements of an issuer in an audit required pursuant to this chapter shall include,  in accordance with generally accepted auditing standards as modified or supplemented by the commission:
1. Procedures designed to provide reasonable assurance of detecting illegal acts that would have a direct and material effect on the determination of financial statement amounts.
2. Procedures designed to identify related party transactions that are material to the financial statements or otherwise require disclosure.
3. An evaluation of whether there is substantial doubt about the ability of the issuer to continue as a going concern during the next fiscal year.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-2123 - Audit discoveries; required responses

44-2123.
Audit discoveries;  required responses
A. In the course of conducting an audit to which this article applies,  if the independent certified public accountant detects or becomes aware of information indicating that an illegal act,  whether or not perceived to have a material effect on the issuer's financial statements,  has or may have occurred,  the independent certified public accountant,  in accordance with generally accepted auditing standards,  as modified or supplemented by the commission,  shall:
1. Determine whether it is likely that an illegal act has occurred and,  if so,  shall determine and consider the possible effect of the illegal act on the financial statements of the issuer,  including any contingent monetary effects such as fines,  penalties and damages.
2. As soon as practicable,  inform the appropriate level of the issuer's management and ensure that the issuer's audit committee or board of directors in the absence of an audit committee is adequately informed about any illegal acts that have been detected or have otherwise come to the attention of the certified public accountant in the course of the audit,  unless the illegal act is clearly inconsequential.
B. After determining that the audit committee or board of directors is adequately informed pursuant to subsection A,  as soon as practicable,  the independent certified public accountant shall report the accountant's conclusions to the board of directors if the independent certified public accountant concludes that all of the following have occurred:
1. The illegal act has a material effect on the financial statements of the issuer.
2. The senior management has not taken,  and the board of directors has not caused senior management to take,  timely and appropriate remedial actions with respect to the illegal act.
3. The failure to take remedial action is reasonably expected to warrant departure from a standard report of the auditor,  when made,  or warrant resignation from the audit engagement.
C. Unless exempted by the commission by rule or order,  an issuer whose board of directors receives a report pursuant to subsection B shall inform the commission by written notice within one business day after receiving the report and shall furnish the independent certified public accountant making the report with a copy of the written notice. If the independent certified public accountant fails to receive a copy of the notice within the required period,  the independent certified public accountant,  within one business day after the failure to receive a copy of the notice,  shall resign from the engagement,  give the commission a copy of the accountant's report or give the commission the documentation of any oral report.
D. If an independent certified public accountant resigns from an engagement pursuant to subsection C,  the independent certified public accountant,  within one business day after the failure to receive a copy of the notice,  shall give the commission a copy of the accountant's report or the documentation of any oral report.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-2125 - Civil penalties in cease and desist proceedings

44-2125.
Civil penalties in cease and desist proceedings
After notice and an opportunity for a hearing in a proceeding instituted pursuant to article 16 of this chapter,  if the commission finds that an independent certified public accountant has wilfully violated section 44-2123,  subsection C or D,  in addition to entering an order pursuant to article 16 of this chapter,  the commission may impose a civil penalty against the independent certified public accountant and any other person that the commission finds was a cause of the violation.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3102 - Interpretations by commission

44-3102.
Interpretations by commission
In interpreting the definitions prescribed in section 44-3101 and other terms and phrases used in this chapter,  the commission may refer to identical terms or phrases in the investment advisers act of 1940 and investment company act of 1940 including regulations or interpretive releases promulgated under those acts and chapter 12 of this title and any rules adopted under that chapter.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3115 - Cooperation with other agencies

44-3115.
Cooperation with other agencies
The director shall cooperate with the administrators of investment adviser,  investment company and management and similar laws of other states and of the United States and with the national association of securities dealers,  inc. with a view to achieving maximum uniformity in the interpretation and enforcement of like provisions of the laws administered by them.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3131 - General rule making power of commission; delegation of authority; limitation

44-3131.
General rule making power of commission;  delegation of authority;  limitation
A. The commission may adopt rules pursuant to title 41,  chapter 6 that are reasonably necessary to carry out the purposes of this chapter.
B. The commission may delegate such authority to the director of securities as is convenient or necessary for the efficient administration of this chapter,  except that the commission may not delegate authority to adopt rules or to enter any final order of denial or revocation of licenses of investment advisers or investment adviser representatives.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3132 - Investigations

44-3132.
Investigations
The commission,  the director or any other agent or agents designated by the commission may:
1. Make private or public investigations within or outside this state that the commission deems necessary to determine whether any person has violated or is about to violate this chapter or any rule or order adopted or issued under this chapter,  to aid in the enforcement of this chapter or to aid in adopting rules and forms under this chapter.
2. At any time either before or after the licensure of any investment adviser or investment adviser representative,  investigate and examine the affairs of any person engaged in the provision of investment advisory services or the affairs of any person if the commission believes that the person is or may be engaged in the provision of investment advisory services.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3133 - Power to require testimony and production of records; order of nondisclosure

44-3133.
Power to require testimony and production of records;  order of nondisclosure
A. For the purpose of investigations or hearings that,  in the opinion of the commission,  are necessary and proper for the enforcement of this chapter,  any member of the commission,  the director or any officer or officers designated by the commission may administer oaths and affirmations,  subpoena witnesses,  take evidence and require by subpoena duces tecum or by citation the production of books,  papers,  contracts,  agreements or other documents,  records or information,  whether filed or kept in original form or electronically stored or recorded,  that the commission deems relevant or material to the inquiry.
B. The commission may issue and apply to enforce a subpoena in this state at the request of a securities agency or administrator of another state if the activities constituting an alleged violation for which the information is sought would be a violation of this chapter if the activities had occurred in this state.
C. In connection with the power to enforce the production of evidence by subpoena vested in the commission by article XV of the Constitution of Arizona and the commission's power to conduct private investigations pursuant to section 44-3132,  the commission has the authority to order a financial institution not to disclose the existence or content of the subpoena to persons not affiliated with the financial institution other than to the financial institution's legal counsel. The commission shall exercise such power if the commission finds it necessary or appropriate in the public interest or for the protection of investors.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3134 - Contempt; penalty

44-3134.
Contempt;  penalty
A. If a person refuses to obey a subpoena or citation issued by the commission,  any member of the commission,  the director or any officer designated by the commission,  the superior court in Maricopa county,  on application by the commission,  shall issue to the person an order requiring that person to appear before the commission,  the director or the officer designated by the commission to produce documentary evidence if so ordered and to give evidence concerning the matter under investigation or in question. The court may punish failure to obey the order of the court as contempt.
B. In the case of wilful noncompliance with a nondisclosure order included in a subpoena issued pursuant to section 44-3133,  on application by the commission,  the superior court in Maricopa county may exercise its contempt powers. For the purposes of this subsection,  " wilful"  has the same meaning as that prescribed to wilfully in section 1-215.
C. The court shall award reasonable expenses,  including attorney fees,  to the commission if the refusal to obey a subpoena or citation issued by the commission was not substantially justified,  unless other circumstances make an award of expenses unjust.
D. Process in any proceeding pursuant to this section may be served on the defendant in any county of this state in which the defendant transacts business or is found.
E. Any expenses,  including attorney fees,  collected pursuant to this section shall be deposited,  pursuant to sections 35-146 and 35-147,  in the state general fund.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3151 - Licensure required; exclusion; violation; classification

44-3151.
Licensure required;  exclusion;  violation;  classification
A. A person shall not transact business in this state as an investment adviser or investment adviser representative unless any of the following applies:
1. The person is licensed under this article.
2. The person is a federal covered adviser and has made a notice filing under this article.
3. The person is exempt from licensure.
4. The person is a federal covered adviser and is not subject to the notice filing requirements prescribed in section 44-3153.
B. The licensure requirements of this article do not apply to any federal covered adviser or a person that is excluded from the definition of an investment adviser under section 202(a)(11) of the investment advisers act of 1940.
C. An investment adviser that is required to be licensed shall not employ an investment adviser representative unless the investment adviser representative is licensed under this article. The licensure of an investment adviser representative is not effective during any period of time that the investment adviser representative is not employed by a licensed investment adviser or by a federal covered adviser that has made a notice filing pursuant to section 44-3153,  subsection E. A licensed investment adviser shall promptly notify the commission when an investment adviser representative begins or terminates employment with the investment adviser by filing a completed form U-4 or form U-5 or any other form as the director may designate.
D. An investment adviser representative shall not conduct business on behalf of a federal covered adviser unless that investment adviser representative is licensed under this article. A federal covered adviser shall notify the commission if any investment adviser representative begins or terminates employment with that federal covered adviser by filing a completed form U-4,  form U-5 or any other form the director designates for that purpose.
E. A person who knowingly violates this section is guilty of a class 1 misdemeanor.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3154 - Licensure application; additional information

44-3154.
Licensure application;  additional information
The commission or the director may require submission of additional information regarding an applicant's previous history,  record or business experience as the commission or director deems necessary to determine whether an applicant should be licensed as an investment adviser or investment adviser representative in this state.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3155 - Investment adviser license; notification

44-3155.
Investment adviser license;  notification
A. If an applicant for licensure as an investment adviser fully complies with this article and commission rules adopted under this article,  the director shall license the applicant as an investment adviser,  unless the commission finds cause for denial as provided in article 6 of this chapter.
B. After the director has licensed an applicant as an investment adviser or has received a complete notice filing from a federal covered adviser,  the director shall promptly notify the applicant or the federal covered adviser through the IARD,  by mail or by any other method that is reasonably acceptable to the commission.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3156 - Application for licensure as investment adviser representative

44-3156.
Application for licensure as investment adviser representative
A. Any individual may apply for licensure as an investment adviser representative. An application for licensure as an investment adviser representative shall be signed by the applicant and by the licensed or federal covered adviser employing or intending to employ the applicant.
B. An application for licensure as an investment adviser representative shall be filed with the commission through the IARD. If the IARD does not provide for receipt of a filing,  the filing may be made with the commission by mail or any other reasonable method that is acceptable to the commission.
C. An application for licensure shall include the following,  together with other information the commission prescribes:
1. A completed form U-4 or any other form as the director may designate. An applicant that has a current form U-4 filed with this state may submit a brief written request for licensure with the commission.
2. Proof of compliance with written examination requirements.
3. If the applicant's fingerprints are not on file with the division,  the CRD system or the IARD,  a full set of fingerprints. The commission shall submit the fingerprints to the department of public safety for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.
D. An application for licensure as an investment adviser representative shall be accompanied by payment of the licensure fee prescribed in section 44-3181.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3157 - Investment adviser representative license; notification

44-3157.
Investment adviser representative license;  notification
A. If an applicant for licensure as an investment adviser representative fully complies with this article and commission rules adopted under this article,  the director shall license the applicant as an investment adviser representative,  unless the commission finds cause for denial as provided in article 6 of this chapter.
B. After the director has licensed an applicant as an investment adviser representative,  the director shall promptly notify the applicant of the licensure by mail,  through the IARD or by any other method that is reasonably acceptable to the commission.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3158 - Expiration, renewal or transfer of licensure; automatic suspension

44-3158.
Expiration,  renewal or transfer of licensure;  automatic suspension
A. All licenses expire on December 31 of each year unless renewed before expiration by payment through the IARD of the fees prescribed by section 44-3181. If the IARD does not provide for receipt of a filing,  the filing may be made with the commission by mail or any other reasonable method that is acceptable to the commission.
B. An investment adviser representative may transfer that investment adviser representative's license to an investment adviser that is either licensed by the commission or that has made a notice filing with the commission by filing a completed application for licensure and remitting a transfer fee to the commission through the IARD. If the IARD does not provide for receipt of a filing,  the filing may be made with the commission by mail or any other reasonable method that is acceptable to the commission. The license of an investment adviser representative will automatically be suspended from the time of termination of employment with an investment adviser until the investment adviser representative is employed by another licensed or federal covered adviser,  the director is notified of the employment by the investment adviser in writing and the investment adviser is notified of approval of the licensure by the director by mail,  through the IARD or by any other reasonable method established by the commission or the investment adviser representative has complied with all requirements in accordance with a temporary investment adviser representative transfer program. The commission may adopt rules providing for temporary transfer of licensure of investment adviser representatives.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3159 - Reporting requirements

44-3159.
Reporting requirements
A. In order to retain licensure,  licensed investment advisers and investment adviser representatives shall file the following with the commission through the IARD:
1. A supplemental statement showing any material changes in the facts contained in the original application for licensure as supplemented or amended as the changes occur or within thirty days after the change.
2. If a licensed investment adviser requires payment of advisory fees six months or more in advance and in excess of five hundred dollars for each client,  an audited balance sheet as of the end of the investment adviser's fiscal year. Each balance sheet shall be:
(a) Prepared in conformity with generally accepted accounting principles and examined in accordance with generally accepted auditing standards.
(b) Audited by an independent certified public accountant.
(c) Accompanied by an opinion of the independent certified public accountant as to the report of financial position,  and by a note stating the principles used to prepare the report,  the basis of included securities and any other explanations required for clarity.
B. If the IARD does not provide for receipt of a filing,  the filing may be made with the commission by mail or any other reasonable method that is acceptable to the commission.
C. The financial statements prescribed in subsection A shall be filed with the commission within ninety days after the end of the investment adviser's fiscal year.
D. Any licensed investment adviser that has its principal place of business in another state is exempt from the requirements prescribed in subsection A if all of the following apply:
1. The investment adviser is registered as an investment adviser with the state in which it maintains its principal place of business.
2. The investment adviser has complied with the financial reporting requirements,  if any,  of the state in which it maintains its principal place of business.
3. If prescribed by the commission,  the investment adviser files with the commission a copy of the financial reports it files with the state in which it maintains its principal place of business.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3181 - Fees; penalties; abandonment

44-3181.
Fees;  penalties;  abandonment
A. The annual nonrefundable license fee for each licensed investment adviser and investment adviser representative and the annual nonrefundable notice filing fee for each federal covered adviser shall be paid to the commission on or before the last working day of December. The annual nonrefundable license fee for each investment adviser and the annual nonrefundable notice filing fee prescribed in section 44-3153,  subsection F are two hundred fifty dollars and the annual nonrefundable license fee for each investment adviser representative is forty dollars.
B. An investment adviser that fails to timely renew an annual investment adviser or investment adviser representative license or notice filing shall pay a penalty of twenty-five dollars per business day until the appropriate documents and fee are filed,  up to a maximum of forty business days. Failure to timely renew is not a violation of section 44-3151 if the license or notice filing fee and penalty are paid within forty business days. Failure to renew within forty business days may result in additional sanctions as provided in this chapter.
C. The transfer fee for an investment adviser representative transferring that investment adviser representative's license from one investment adviser to another investment adviser is forty dollars.
D. All applications,  withdrawals,  terminations,  transfers,  renewals or other filings with the IARD shall be on the forms required by the IARD and shall be accompanied by any reasonable costs charged by the IARD for processing the filings. Any person who is required to pay a fee pursuant to this section may transmit the fee to the commission through the IARD.
E. The commission shall retain any notice filing or licensure fees that are collected in connection with abandoned applications or notice filings. A notice filing or an application for licensure is deemed abandoned if both:
1. The notice filing or application has been on file with the commission for at least six months or the applicant or notice filer has failed to respond to a request for information for at least two months after the date of the request.
2. The applicant or notice filer has failed to respond to the commission's notice of warning of abandonment within sixty calendar days after the date of the warning.
F. The fee for submitting fingerprints is the fee that is required by the federal government and the department of public safety.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3202 - Entry of order of denial, suspension or revocation

44-3202.
Entry of order of denial,  suspension or revocation
A. If,  after a hearing or notice and an opportunity for a hearing as provided in article 7 of this chapter,  the commission finds grounds to deny,  suspend or revoke the license of an investment adviser or investment adviser representative,  the director shall enter an order denying,  suspending or revoking the license of the investment adviser or investment adviser representative. The order shall state specifically the grounds for its issuance and shall be filed with docket control of the commission.
B. A copy of the order shall be sent by certified mail to the investment adviser or investment adviser representative whose license is denied,  suspended or revoked,  and if the denial,  suspension or revocation of the license is of an investment adviser representative,  to the licensed investment adviser who employs the investment adviser representative.
C. Denial,  suspension or revocation of the license of an investment adviser also suspends or revokes the license of all of the investment adviser's investment adviser representatives,  but suspension or revocation of the license of an investment adviser representative solely because the investment adviser representative was employed by an investment adviser whose license was denied,  suspended or revoked does not prejudice subsequent applications for licensure by the investment adviser representative.
D. An investment adviser or investment adviser representative that has voluntarily terminated or allowed the adviser's or representative's license to lapse shall continue to be subject to actions by the commission under this article in connection with conduct that began before the termination or lapse of the license. Any action by the commission under this article against an investment adviser or investment adviser representative shall begin within two years after termination or lapse of the license.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3211 - Initiation of hearing; purpose of hearing

44-3211.
Initiation of hearing;  purpose of hearing
The commission may order a hearing on its own initiative or at the written request of any interested person,  either before or after licensure of an investment adviser or investment adviser representative:
1. For the purpose of administering or obtaining information necessary in the enforcement of this chapter or the rules or orders of the commission adopted or issued under this chapter.
2. To enable the commission to take appropriate action in connection with any pending application for licensure of any investment adviser or investment adviser representative.
3. To modify the terms and conditions of any license,  order or notice filing.
4. To determine whether the license of any investment adviser or investment adviser representative should be denied,  suspended or revoked.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3212 - Notice of an opportunity for a hearing; time of hearing

44-3212.
Notice of an opportunity for a hearing;  time of hearing
A. Before entering an order denying,  suspending or revoking the license of an investment adviser or investment adviser representative pursuant to article 6 of this chapter,  the commission shall send to the investment adviser or investment adviser representative,  and,  if an investment adviser representative,  to the investment adviser who employs or intends to employ the investment adviser representative,  a notice of a hearing or notice of an opportunity for a hearing.
B. Before entering an order to cease and desist or an order for rescission,  restitution or penalties,  the commission shall serve on each respondent a notice of a hearing or a notice of an opportunity for a hearing. The commission by rule may provide for temporary cease and desist orders if the public welfare requires immediate action.
C. Notice of a hearing or notice of an opportunity for a hearing shall be served as prescribed by rules adopted by the commission for service of subpoenas and cease and desist orders. The notice shall contain a statement of the matters to be considered. A notice of an opportunity for a hearing shall state that the person to whom the notice is sent will be afforded a hearing on request to the commission if the request is made in writing within ten days after receipt of the notice.
D. If a person requests a hearing in accordance with this article,  the commission shall set a date,  time and place for the hearing and shall immediately notify the person requesting the hearing of the date,  time and place for the hearing. The date set for the hearing shall be within sixty days,  but not earlier than twenty days after the request for a hearing has been made,  unless otherwise agreed to by both the commission and the person requesting the hearing.
E. If the hearing is initiated by the commission the notice of the hearing shall specify the date,  time and place of the hearing and the date of the hearing shall be within twenty days of the date of the notice of the hearing.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3213 - Conduct of hearing

44-3213.
Conduct of hearing
A. Any hearing under this article may be held before the commission,  a member of the commission,  the director or any other authorized officer of the commission as the commission directs.
B. Conduct of the hearing is governed by this section and by the rules of practice and procedure adopted by the commission. The commission,  a member of the commission,  the director and any other authorized officers of the commission are not bound by the technical rules of evidence in the conduct of hearings under this article,  and no informality in any proceeding,  as in the manner of taking testimony,  invalidates any order,  decision or rule made,  approved or confirmed by the commission.
C. The commission shall appoint a shorthand reporter to make a stenographic record of all proceedings and testimony of each hearing,  and the record shall be reduced to writing and filed with the commission.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3214 - Rehearings

44-3214.
Rehearings
The commission may institute or grant rehearings on application made within twenty calendar days after entry of an order or decision. Unless otherwise ordered,  filing an application for rehearing does not stay the commission s decision or order. If the commission does not grant a rehearing within twenty calendar days,  the application is considered to be denied. Rehearings are subject to this article.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3241 - Fraud in provision of investment advisory services; liability; violation; classification

44-3241.
Fraud in provision of investment advisory services;  liability;  violation;  classification
A. It is a fraudulent practice and unlawful for a person,  in connection with a transaction or transactions within or from this state involving the provision of investment advisory services,  directly or indirectly,  to do any of the following:
1. Employ any device,  scheme or artifice to defraud.
2. Make any untrue statement of material fact,  or fail to state any material fact necessary in order to make the statement made,  in the light of the circumstances under which it was made,  not misleading.
3. Misrepresent any professional qualifications with the intent that the client rely on the misrepresentation.
4. Engage in any transaction,  practice or course of business that operates or would operate as a fraud or deceit.
B. A person who violates this section is liable to any person for all losses incurred by that person as a result of the violation,  together with interest on losses incurred,  court costs and reasonable attorney fees. A civil action under this section is barred unless it is brought within three years after the violation or within two years after discovery of the facts constituting the violation,  whichever occurs first.
C. A person who violates this section is guilty of a class 4 felony.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3271 - Petition for appointment of conservators and receivers

44-3271.
Petition for appointment of conservators and receivers
If an act,  practice or transaction that constitutes a violation of section 44-3151 or article 9 of this chapter is alleged in a complaint filed by this state or an agency of this state,  the commission may petition the superior court in Maricopa county for the appointment of a conservator to reorganize the affairs of,  or a receiver to wind up the affairs of,  the violator. The commission may transmit any evidence it has available concerning the act,  practice or transaction to the attorney general. On receipt of the evidence,  the attorney general may petition the superior court in Maricopa county for the appointment of a conservator to reorganize the affairs of,  or a receiver to wind up the affairs of,  the violator. Process in these actions may be served on the defendant in any county in this state in which the defendant transacts business or is found.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3291 - Jurisdiction and venue of offenses and actions; joinder of spouse

44-3291.
Jurisdiction and venue of offenses and actions;  joinder of spouse
A. The superior court has jurisdiction over violations of this chapter,  the rules and orders of the commission adopted or issued under this chapter and all actions brought to enforce any liability or duty created under this chapter,  except actions or proceedings brought under section 44-3292,  paragraph 2,  3 or 4 or appeals filed under article 8 of this chapter,  over which the superior court in Maricopa county has exclusive jurisdiction.
B. Any action authorized by this chapter may be brought in the county in which the defendant is found,  is an inhabitant or transacts business or in the county in which the transaction took place. Process may be served on any defendant in any county of this state in which the defendant is an inhabitant or in which the defendant is found.
C. The commission may join the spouse in any action authorized by this chapter to determine the liability of the marital community. This subsection does not authorize the commission to join any individual who is divorced from the defendant at the time an action authorized by this chapter is filed.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3293 - Burden of proof of exemptions

44-3293.
Burden of proof of exemptions
If a defense in any civil or criminal action is based on any exemption provided for in this chapter,  the burden of proving the existence of the exemption is on the party raising the defense,  and it is not necessary to negate the exemption in any petition,  complaint,  information or indictment made or brought in any proceeding under this chapter.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3294 - Evidence of licensure or lack of licensure

44-3294.
Evidence of licensure or lack of licensure
A certificate signed by the director and under seal of the commission showing that a notice filing has or has not been filed as provided in article 4 of this chapter or that an investment adviser or investment adviser representative has or has not been licensed as provided in article 4 of this chapter constitutes evidence of the facts so certified and is admissible in evidence in any civil or criminal action or proceeding in which the question of the notice of filing or licensure may be at issue.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3295 - Evidence of record of proceedings

44-3295.
Evidence of record of proceedings
A certificate signed by the director,  and under seal of the commission,  in regard to the record of any proceeding under this chapter for denial,  suspension or revocation of the license of any investment adviser or investment adviser representative constitutes evidence of the record and is admissible in any civil or criminal proceeding in which the record may be at issue.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3296 - Administrative penalty

44-3296.
Administrative penalty
A. A person who,  in an administrative action,  is found to have violated this chapter or any rule or order of the commission may be assessed an administrative penalty by the commission,  after a hearing,  of not more than one thousand dollars for each violation.
B. Any administrative penalties collected pursuant to this section shall be deposited,  pursuant to sections 35-146 and 35-147,  in the state general fund.
C. If judicial review has not been sought under title 12,  chapter 7,  article 6,  a certified copy of any commission order requiring the payment of restitution or administrative penalties may be filed in the office of the clerk of the superior court in any county of this state. The clerk shall treat the commission order in the same manner as a judgment of the superior court. A commission order so filed has the same effect as a judgment of the superior court and may be recorded,  enforced or satisfied in like manner. No filing fee is required under this section.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3298 - Investment management regulatory and enforcement fund; purpose

44-3298.
Investment management regulatory and enforcement fund;  purpose
A. An investment management regulatory and enforcement fund is established and shall be administered by the commission under the conditions and for the purposes provided by this section. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.
B. Fees and costs collected pursuant to this chapter,  unless otherwise designated,  shall be deposited,  pursuant to sections 35-146 and 35-147,  in the fund.
C. The commission shall use the monies in the fund for education and regulatory,  investigative and enforcement operations in the securities division.
D. If the amount of monies in the fund exceeds one hundred thousand dollars on December 31 of any calendar year,  the amount in excess of one hundred thousand dollars reverts to the state general fund. Beginning with the fiscal year starting on July 1,  1996,  monies in the fund are subject to annual legislative appropriation.
2023 Arizona Revised Statutes › Title 44 - Trade and Commerce › § 44-3299 - State liability; limitation

44-3299.
State liability;  limitation
Except as otherwise provided by law,  this state,  any political subdivision of this state,  the commission,  the director or any state officer,  agent or employee acting in good faith is not liable for any injury or damage to investors or the general public resulting from any actual or opportunity losses suffered through the activities of investment advisers or investment adviser representatives.