Mississippi Administrative Code › Title 1 - Secretary of State › Part 14 - Securities Regulation › Chapter 6 - INVESTMENT ADVISERS › Rule 1-14-6.25 - Standards of Conduct

Current through June 25, 2024
A person who is an investment adviser, an investment adviser
				  representative, or a federal covered investment adviser is a fiduciary and has
				  a duty to act primarily for the benefit of its clients. Acts, conduct, and
				  practices, including, but not limited to, the following, are considered
				  contrary to such duty and may constitute grounds for denial, suspension,
				  revocation of registration, a bar, imposition of fines, or such other action
				  authorized by statute:
A. Recommending
				to a client to whom investment advisory, supervisory, management, or consulting
				services are provided the purchase, sale, or exchange of any security without
				reasonable grounds to believe that the recommendation is suitable for the
				client on the basis of information furnished by the client after reasonable
				inquiry concerning the client's investment objectives, risk tolerance,
				financial situation, and needs, and any other information known or acquired by
				the investment adviser investment adviser representative or federal covered
				investment adviser.
B. Placing an
				order to purchase or sell a security for a client's account without authority
				to do so.
C. Placing an order to
				purchase or sell a security for a client's account upon instruction from a
				third party without first having obtained a written third-party trading
				authorization from the client.
D.
				Borrowing money or securities from a client unless the client is a
				broker-dealer, an affiliate of the investment adviser, or a financial
				institution engaged in the business of loaning funds.
E. Loaning money to a client unless the
				investment adviser is a financial institution engaged in the business of
				loaning funds or the client is an affiliate of the investment
				adviser.
F. Publishing,
				circulating, or distributing any advertisement which directly or indirectly
				does any one of the following:
1. Refers to
				any testimonial of any kind concerning the investment adviser, investment
				adviser representative, or federal covered investment adviser, or concerning
				any advice, analysis, report, or other service rendered by such investment
				adviser or investment adviser representative.
2. Refers to past specific recommendations of
				the investment adviser, investment adviser representative, or federal covered
				investment adviser that were or would have been profitable to any person;
				except that an investment adviser or investment adviser representative may
				furnish or offer to furnish a list of all recommendations made by the
				investment adviser, investment adviser representative, or federal covered
				investment adviser within the immediately preceding period of not less than one
				(1) year if the advertisement or list also includes both of the following:
a. The name of each security recommended, the
				date and nature of each recommendation, the market price at that time, the
				price at which the recommendation was to be acted upon, and the most recently
				available market price of each such security.
b. A legend on the first page in prominent
				print or type that states that the reader should not assume that
				recommendations made in the future will be profitable or will equal the
				performance of the securities in the list.
3. Represents that any graph, chart, formula,
				or other device being offered can in and of itself be used to determine which
				securities to buy or sell, or when to buy or sell them; or which represents,
				directly or indirectly, that any graph, chart, formula, or other device being
				offered will assist any person in making that person's own decisions as to
				which securities to buy or sell, or when to buy or sell them, without
				prominently disclosing in such advertisement the limitations thereof and the
				difficulties with respect to its use.
4. Represents that any report, analysis, or
				other service will be furnished for free or without charge, unless such report,
				analysis, or other service actually is or will be furnished entirely free and
				without any direct or indirect condition or obligation.
5. Represents that the Administrator has
				approved any advertisement.
6.
				Contains any untrue statement of a material fact or is otherwise false or
				misleading.
7. For the purposes of
				this section, the term "advertisement" shall include any notice, circular,
				letter, or other written communication addressed to more than one person, or
				any notice or other announcement in any electronic or paper publication, by
				radio or television, or by any medium, that offers any one of the following:
a. Any analysis, report, or publication
				concerning securities.
b. Any
				analysis, report, or publication that is to be used in making any determination
				as to when to buy or sell any security or which security to buy or
				sell.
c. Any graph, chart, formula,
				or other device to be used in making any determination as to when to buy or
				sell any security, or which security to buy or sell.
d. Any other investment advisory service with
				regard to securities.