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STATE OF OKLAHOMA
1st Session of the 59th Legislature (2023)
SENATE BILL 1091 By: Floyd
AS INTRODUCED
An Act relating to the Oklahoma Uniform Securi ties
Act of 2004; amending 71 O.S. 2021, Section 1-601, as
amended by Section 34, Chapter 7 7, O.S.L. 2022 (71
O.S. Supp. 2022, Section 1 -601), which relates to
administration; modify ing qualifications for certain
member of Oklahoma Securities Commission; updating
statutory language; and providing an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 71 O.S. 2021, Section 1 -601, as
amended by Section 34, Chapter 77, O.S.L. 2022 (71 O.S. Supp. 2022,
Section 1-601), is amended to read as follows:
Section 1-601. A. The Administrator shall admini ster the
Oklahoma Uniform Securities Act of 2004.
B. There are hereby created the Oklahoma Securities Commission
and the Department of Securities. The Commission shall be the
policy making and governing authority of the Department, shall
appoint the Administrator and shall be res ponsible for the
enforcement of the Oklahoma Uniform Securities Act of 2004.
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C. 1. The Commission shall consist of four (4) members to be
appointed by the Governor by and with the advice and consent of the
Senate. One member will be a member of the Oklahoma Bar Association
appointed from a list of five nominees submitted by the Oklahoma Bar
Association; one member shall be an active officer of a bank or
trust company operating in the State of Oklahoma appointed from a
list of five nominees submitted by the Oklahoma Bankers Association;
and one member shall be a certified public accountant appo inted from
a list of five nominees submitted by the Oklahom a Society of
Certified Public Accountants; and one member shall be a resident of
this state actively engaged in the securities industry and shall be
appointed for a six-year initial term from a list of five nominees
submitted by the Oklahoma Securities Industry Association with the
qualifications set forth in paragraph 3 of this subsection;
provided, that the State Banking Commissioner shall be and is here by
made an ex officio a voting member of the Commission.
2. Except for appointment of the member engaged i n the
securities industry as pr ovided for in subsection C of this section,
no person may be appointe d to or by the Commission while such person
is registered as a broker-dealer, agent, investment adviser, or
investment adviser representative under the Okla homa Uniform
Securities Act of 2004, or while he or she is an officer, director,
or partner of any person so registered, or while he or she is an
officer, director, or partner o f an issuer which has a registration
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statement effective under the Oklahoma Uni form Securities Act of
2004, or while he or she is occupying a similar status or performing
similar functions.
3. The member appointed as a representative of the secur ities
industry shall:
a. be currently registered as an agent, investment
adviser, or investment adviser representative under
the requirements of this title,
b. have at least ten (10) years of experience in the
industry immediately preceding appointment , and
c. have not been subject to a regula tory action requiring
disclosure on the unifor m applications for
registration for agents, in vestment advisers, or
investment adviser representatives.
The member may be removed from office by the Governor when the
member has ceased to be qualified based on subparagraph a or c of
this paragraph.
4. It is unlawful for any member of the Commission, the
Administrator, or any other officer or employee of the Department to
use for personal benefit a ny information which is filed with or
obtained by the Administrator and which is not made pub lic. No
provision of the Oklahoma Uniform Securiti es Act of 2004 author izes
any member of the Commission, the Administrator or any other officer
or employee of the Department to disclose any such information
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except among themselves or when necessary or ap propriate in a
proceeding or investigation under th e Oklahoma Uniform Se curities
Act of 2004 or in connection with a proceeding or investigation
conducted by any state, federal or foreign law enfor cement agency,
securities agency or self-regulatory organization. No provision of
the Oklahoma Uniform Securi ties Act of 2004 eith er creates or
derogates from any privilege which exists at common law or otherwise
when documentary or other evidence is soug ht under a subpoena
directed to any member of the Commissio n, the Administrator or any
other officer or employ ee of the Department.
4. 5. Except on proof of corruption, no Commissioner shall for
his or her acts or failure to act be civilly liable to any inve stor,
applicant for registration, or any other person.
D. The Governor shall biennially appoint Commission me mbers to
serve for a staggered term of six (6) years. Upon the expiration of
initial terms, the term of each member shall be six (6) years from
the date of his or her appointment and qualification, and un til his
or her successor shall qualify. Vacancies shall be filled by the
Governor for the unexpired term. Members shall be eligible for
reappointment.
E. The Commission shall select a chair and is hereby authorized
to adopt rules for conducting its proc eedings. Any three members
shall constitute a quor um for transacting Commission business. The
Commission shall meet bimonthly on such date as it may designate and
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may meet at such other times as it may deem necessary, or when
called by the chair or by an y two members. Complete minutes of each
meeting shall be kept and filed in the Department and shall be
available for public inspection during reasonable office hours. The
Commission shall report annually to the Governor, to the Speaker of
the House of Representatives and to the President Pro Tempore of t he
Senate. The report shall contain the minutes of each meeting held
during the year, legislative recommendat ions, a summary of
violations of the Oklahoma Uniform Securities Act of 2004 and action
taken thereon, a list of securities registered under the O klahoma
Uniform Securities Act of 2004 and such other data and information
as may be deemed necessary or appro priate. The Commission is hereby
authorized to publish such report, and the Administrator may sell
copies of such report at such price as is reas onably sufficient to
defray the expenses of the Department in preparing, publishing, and
disseminating the sam e. Each member of the Commission sh all have
unrestricted access to all offices and records und er the
jurisdiction of the Department. The Commiss ion, or a majority
thereof, may exercise any power or perform any act authorized for
the Administrator under t he provisions of the Oklahoma Unifor m
Securities Act of 2004.
F. The Commission shall appoint a full-time Administrator, who
shall serve at the p leasure of the Commission. The Administrator
shall administer the Oklahoma Uniform Securities Act of 2004 und er
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the supervision of the Commission and in accordance with its
policies.
G. The Administrator shall be a person of good moral character,
at least thirty (30) years of age, a resident taxpayer of Oklahoma,
and thoroughly familiar with corporate organizati on, investment
banking, investment t rusts, the sale of securities, and the
statistical details of the manufacturing industries and commerce of
this state. In addition, the Administrator shall:
1. Be a graduate of an accredited law school and a member of
the Oklahoma Bar Association, or sha ll have had ten (10) years’
experience as a certified publi c accountant; and
2. Have at least three (3) years ’ work experience involving
some aspect of the securities industry. The Commission may also
require additional qualifications. The salary of the Administrator
shall be fixed by the Commission.
H. The Administrator, with the approval of the Commission, m ay
designate a Deputy Securities Administrator, who shall possess the
same qualifications, including bond, req uired for the Administrator
and who shall perform all the duties required to be performed by th e
Administrator when the Administrator is absent or unable to act for
any reason.
I. Before assuming office, the Administrator shall give a bond
in the sum of Fifty Thousand Dollars ($50,000.00) p ayable to the
State of Oklahoma, to be approved by the Atto rney General of the
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State of Oklahoma, conditioned that he or she will faithfully
execute the duties of the office. The Administrator may by rule or
order require any employee of the Department to be bonded on the
same condition and in the same or such le sser amount as he or she
determines. The expense o f all such bonds shall be paid from funds
available to the Department.
J. 1. The internal administrative org anization of the
Department shall be determined by the Commission in such manner as
to promote the efficient and effective enforcement of the Okla homa
Uniform Securities Act of 2004. The Department shall include, but
not be limited to, divisions relating to:
a. registration of broker -dealers, agents, investment
advisers, and investment adviser repr esentatives,
b. registration of securities,
c. investigation and enforcement, and
d. investor education.
2. Within the division of investor education, the Depar tment
may provide the following serv ices at the discretion of the
Administrator:
a. informing investors of all rights and remedies
available under this act,
b. informing investors of the availability of private
dispute resolution, including arbitration and
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mediation, as an alternative to oth er courses of
action,
c. acting as a liaison between inv estors and the other
divisions of the Department, and
d. acting as a liaison between investors and issuers of
securities, broker-dealers or investment advisers
subject to the jurisdiction of the Depar tment under
this act.
Nothing in this subsection shall authorize any employee of the
Department to represent t he interests of, or to serve as counsel
for, investors in any proceeding or action to include an
administrative or civil proceeding brought by the Department or the
Securities and Exchange Commission, a proceeding brought by the
National Association of Sec urities Dealers, Inc. Financial Industry
Regulatory Authority, Inc. , or an arbitration or mediation
proceeding. Further, no employee of the Department may advise any
person about the value of securities or as to the advisability of
investing in, purchasing or selling securities, or as to the value
or merits of pursuing a particular course of action.
3. Records of the division of investor education shall not be
exempt from the provis ions of the Open Records Act and Section 1-607
of this title except as provided for in subparagraph 8 of paragraph
B of Section 1-607 of this title.
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K. The Administrator shall prepare in writing a manual of
necessary employee pos itions for the Department, including job
classifications, personnel qualifications, duties, maximum and
minimum salary schedules, and other personnel information, which
shall be approved by the Com mission. The Administrator may select,
appoint, and employ such attorneys, accountants, auditors,
examiners, investigators, clerks, stenographers, and other personnel
as he or she deems necessary for the prope r administration of the
Oklahoma Uniform Securities Act of 2004, and may fix their
compensation and the salary of the De puty Administrator. The D eputy
Administrator and other employees of the Department shall serve at
the pleasure of the Administrator.
L. The Commission and the Securities Department shall be
assigned offices in Oklahoma City, Oklahoma, by the Office of
Management and Enterprise Se rvices, and all records of the
Commission and Department shall be kept in those offices, unless and
until transferred to the Records Management Division of the Oklahoma
Department of Libraries.
M. 1. Neither the Administrator nor any employee of the
Department, during their respec tive terms of employment, shall serve
as a director, officer, shareholder, member, partner, agent or
employee of any person who, during the period of such
Administrator’s or employee’s employment with the Department:
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a. was licensed or applied for registra tion as a broker-
dealer, agent, investment adviser or investment
adviser representative under this act, or
b. applied for or secured the registration of securities
under the Oklahoma Unifo rm Securities Act of 2004.
2. Nothing in paragraph 1 of this subsec tion shall prohibit the
holding, purchasing or selling of any securities by the
Administrator or any employee of the Department in accordance with
regulations adopted by the Commission for the purpose of protecting
the public interest and avoiding conflict s of interest.
3. Nothing contained in paragraph 1 of this subsection shall
prohibit the holding, purchasing or selling of any securities of any
issuer described in subparagraph b of para graph 1 of this subsection
of this section by the Administrator if e ither:
a. the Administrator together with his or her spouse, or
minor children, owns less than one percent (1%) of any
class of outstanding securities of any such issuer so
long as such securities are not purchased in an
initial public offering, or
b. such securities are held or purchased through a
management account or trust administered by a bank or
trust company authorized to do business in this state
that has sole investment discretion regarding the
holding, purchasing or selling of such securities and
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the Administrator or employee did not, directly or
indirectly, advise, counsel or command the holding,
purchasing or selling of any securities or furnish any
information relating to any su ch securities to such
bank or trust company and further, such accoun t or
trust does not at any time have more than ten percent
(10%) of its total assets invested in the securitie s
of any one issuer or hold more than five percent (5%)
of the outstanding sec urities of any class of
securities of any one issuer.
N. The Oklahoma Uniform Securities Act of 2004 does not create
or diminish a privilege or exemption that exists at comm on law, by
statute or rule, or otherwise.
O. The Administrator may develop and im plement investor
education initiatives to inform the public about in vesting in
securities, with particular emphasis on the prevention and detection
of securities fraud. In developing and implementing these
initiatives, the Administrator may collaborate wi th public and
nonprofit organizations with an interest in investor e ducation. The
Administrator may accept a grant or donation from a person that is
not affiliated with the securities industry or from a nonprofit
organization, regardless of whether the or ganization is affiliated
with the securities industry, to develop an d implement investor
education initiatives. This subsection does not authorize the
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Administrator to require participation or monetary contributions of
a registrant in an investor educatio n program.
SECTION 2. This act shall become effecti ve November 1, 2023.
59-1-1393 TEK 1/19/2023 2:26:24 PM