Tennessee § 48-1-121 - Fraudulent acts or devices.

§ 48-1-121. Fraudulent acts or devices.

It is unlawful for any person, in connection with the offer, sale or purchase of any security in this state, directly or indirectly, to: Employ any device, scheme, or artifice to defraud; Make any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they are made, not misleading; or Engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person. It is unlawful for any person who receives any consideration from another person primarily for advising the other person as to the value of securities or their purchase or sale, whether through the issuance of analyses or reports or otherwise, in this state, to: Employ any device, scheme, or artifice to defraud the other person; Engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon the other person; or Take or have custody of any securities or funds of any client except as the commissioner may by rule permit or unless the person is licensed as a broker-dealer under this part. It is unlawful for any person to make or cause to be made, in any document filed with the commissioner or in any proceeding under this part, any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they are made, not misleading. The commissioner may, after notice and opportunity for a hearing under the Uniform Administrative Procedures Act, compiled in title 4, chapter 5, impose a civil penalty against any person found to be in violation of this section, or any rule or order adopted or issued under this section, in an amount not to exceed ten thousand dollars ($10,000) per violation, or in an amount not to exceed twenty thousand dollars ($20,000) per violation if an individual who is a designated adult is a victim. Acts 1980, ch. 866, § 21; T.C.A., § 48-16-121 ; Acts 1996, ch. 1072, § 9; 1997, ch. 164, § 7; 2010, ch. 829, § 4; T.C.A., § 48-2-121 ; Acts 2017, ch. 424, § 42. Code Commission Notes. Former § 48-2-121 was transferred to § 48-1-121 by the code commission in 2012. Compiler's Notes. The Securities Law of 1955, formerly codified as §§ 48-1601 — 48-1653, was repealed by Acts 1980, ch. 886, § 27. However, the section also contained a savings provision referring to former §§ 48-1601 — 48-1653 which read: “(b) Prior law exclusively governs all suits, actions, prosecutions, or proceedings which are pending or may be initiated on the basis of facts or circumstances occurring before the effective date of this Act, except that no civil suit or action may be maintained to enforce any liability under prior law unless brought within any period of limitation which applied when the cause of action accrued and in any event within two years after the effective date of this Act. “(c) All effective registrations under prior law, all administrative orders relating to such registrations, and all conditions imposed upon such registrations remain in effect so long as they would have remained in effect if this Act had not been passed. They are considered to have been filed, entered, or imposed under this Act, but are governed by prior law. “(d) Prior law applies in respect of any sale made within one year after the effective date of this Act pursuant to an offering exempt under prior law which offering was begun in good faith before such effective date. “(e) Judicial review of all administrative orders as to which review proceedings have not been instituted by the effective date of this Act are governed by Section 20, except that no review proceeding may be instituted unless the petition is filed within any period of limitation which applied to a review proceeding when the order was entered and in any event within 60 days after the effective date of this Act.” The effective date of the Act was July 2, 1980. Law Reviews. SEC Injunctions, 68 Tenn. L. Rev. 427 (2001).