How are securities regulated?
The securities laws divide regulation into three major categories: anti-fraud, registration and licensing. Anti-fraud The anti-fraud statute makes it unlawful to defraud another in connection with the offer or sale of securities. The statute prohibits any person from employing a device, scheme, or artifice to defraud. It also makes it unlawful for persons to make untrue statements regarding material facts or to omit material facts in order to make other statements not misleading. Finally, the statute prohibits persons from engaging in a practice or course of business which would operate as a fraud on a person. The Division of Securities investigates anti-fraud violations which may result in administrative or civil action, or even referral for criminal prosecution. The anti-fraud statute is found at Section 61-1-1 of the Utah Code Annotated. Licensing You must become licensed prior to offering or selling securities as a broker-dealer, broker-dealer agent or issuer agent. To become licen
