517.161 Revocation, denial, or suspension of registration of dealer, investment adviser, intermediary, or associated person.—
(1) Registration under s. 517.12 may be denied or any registration granted may be revoked, restricted, or suspended by the office if the office determines that such applicant or registrant; any member, principal, or director of the applicant or registrant or any person having a similar status or performing similar functions; or any person directly or indirectly controlling the applicant or registrant:
(a) Has violated any provision of this chapter or any rule or order made under this chapter;
(b) Has made a material false statement in the application for registration;
(c) Has been guilty of a fraudulent act in connection with rendering investment advice or in connection with any sale of securities, has been or is engaged or is about to engage in making fictitious or pretended sales or purchases of any such securities or in any practice involving the rendering of investment advice or the sale of securities which is fraudulent or in violation of the law;
(d) Has made a misrepresentation or false statement to, or concealed any essential or material fact from, any person in the rendering of investment advice or the sale of a security to such person;
(e) Has failed to account to persons interested for all money and property received;
(f) Has not delivered, after a reasonable time, to persons entitled thereto securities held or agreed to be delivered by the dealer or investment adviser, as and when paid for, and due to be delivered;
(g) Is rendering investment advice or selling or offering for sale securities through any associated person not registered in compliance with this chapter;
(h) Has exercised management or policy control over or owned 10 percent or more of the securities of any dealer, intermediary, or investment adviser that has been declared bankrupt, or had a trustee appointed under the Securities Investor Protection Act; or is, in the case of a dealer, intermediary, or investment adviser, unable to pay its debts as they become due in the usual course of business;
(i) Has been convicted of, or has entered a plea of guilty or nolo contendere to, regardless of whether adjudication was withheld, a crime against the laws of this state or any other state or of the United States or of any other country or government which relates to registration as a dealer, investment adviser, issuer of securities, intermediary, or associated person; which relates to the application for such registration; or which involves moral turpitude or fraudulent or dishonest dealing;
(j) Has had a final judgment entered against her or him in a civil action upon grounds of fraud, embezzlement, misrepresentation, or deceit;
(k) Has been the subject of any decision, finding, injunction, suspension, prohibition, revocation, denial, judgment, or administrative order by any court of competent jurisdiction, administrative law judge, or by any state or federal agency, national securities, commodities, or option exchange, or national securities, commodities, or option association, involving a violation of any federal or state securities or commodities law or any rule or regulation promulgated thereunder, or any rule or regulation of any national securities, commodities, or options exchange or national securities, commodities, or options association, or has been the subject of any injunction or adverse administrative order by a state or federal agency regulating banking, insurance, finance, real estate, mortgage brokers or lenders, money transmitters, or other related or similar industries. For purposes of this subsection, the office may not deny registration to any applicant who has been continuously registered with the office for 5 years after the date of entry of such decision, finding, injunction, suspension, prohibition, revocation, denial, judgment, or administrative order provided such decision, finding, injunction, suspension, prohibition, revocation, denial, judgment, or administrative order has been timely reported to the office pursuant to the commission’s rules;
(l) Made payment to the office for a registration with a check or electronic transmission of funds that is dishonored by the applicant’s or registrant’s financial institution;
(m) Failed to pay and fully satisfy any final judgment or arbitration award resulting from an investment-related, client- or customer-initiated arbitration or court proceeding, unless alternative payment arrangements are agreed to in writing between the client or customer and the investment adviser, dealer, or associated person and the investment adviser, dealer, or associated person complies with the terms of the alternative payment arrangement;
(n) Attempted to avoid payment of any final judgment or arbitration award resulting from an investment-related, client- or customer-initiated arbitration or court proceeding, unless alternative payment arrangements are agreed to in writing between the client or customer and the investment adviser, dealer, or associated person and the investment adviser, dealer, or associated person complies with the terms of the alternative payment arrangements; or
(o) Failed to pay and fully satisfy any fine, civil penalty, order of restitution, order of disgorgement, or similar monetary payment obligation imposed upon the investment adviser, dealer, or associated person by the Securities and Exchange Commission, the securities regulator or other financial services regulator of any state or province, or any securities industry self-regulatory organization.
(2) The payment or anticipated payment of any amount from the Securities Guaranty Fund in settlement of a claim or in satisfaction of a judgment against an applicant or registrant constitutes prima facie grounds for the denial of the applicant’s application for registration or the revocation of the registrant’s registration.
(3) In the event the office determines to deny an application or revoke a registration, it shall enter a final order with its findings on the register of dealers and associated persons; and denial, suspension, or revocation of the registration of a dealer, intermediary, or investment adviser shall also deny, suspend, or revoke the registration of all her or his associated persons.
(4) It shall be sufficient cause for denial of an application or revocation of registration, in the case of a partnership, corporation, limited liability company, or unincorporated association, if any member of the partnership; any manager or managing member of the limited liability company; or any officer, director, or ultimate equitable owner of the corporation or association has committed any act or omission which would be cause for denying, revoking, restricting, or suspending the registration of an individual dealer, investment adviser, intermediary, or associated person. As used in this subsection, the term “ultimate equitable owner” means a natural person who directly or indirectly owns or controls an ownership interest in the corporation, partnership, association, or other legal entity however organized, regardless of whether such natural person owns or controls such ownership interest through one or more proxies, powers of attorney, nominees, corporations, associations, partnerships, trusts, joint stock companies, or other entities or devices, or any combination thereof.
(5) The office may deny any request to terminate or withdraw any application or registration if the office believes that an act that would be a ground for denial, suspension, restriction, or revocation under this chapter has been committed.
(6) Registration under s. 517.12 may be denied or any registration granted may be suspended or restricted if an applicant or registrant is charged, in a pending enforcement action or pending criminal prosecution, with any conduct that would authorize denial or revocation under subsection (1). Registration under s. 517.12 may be suspended or restricted if a registrant is arrested for any conduct that would authorize revocation under subsection (1).
(a) Any denial of registration ordered under this subsection shall be without prejudice to the applicant’s ability to reapply for registration.
(b) Any order of suspension or restriction under this subsection shall:
1. Take effect only after a hearing, unless no hearing is requested by the registrant or unless the suspension or restriction is made in accordance with s. 120.60(6).
2. Contain a finding that evidence of a prima facie case supports the charge made in the enforcement action or criminal prosecution.
3. Operate for no longer than 10 days beyond receipt of notice by the office of termination with respect to the registrant of the enforcement action or criminal prosecution.
(c) For purposes of this subsection:
1. The term “enforcement action” means any judicial proceeding or any administrative proceeding where such judicial or administrative proceeding is brought by an agency of the United States or of any state to enforce or restrain violation of any state or federal law, or any disciplinary proceeding maintained by the Financial Industry Regulatory Authority, the National Futures Association, or any other similar self-regulatory organization.
2. An enforcement action is pending at any time after notice to the applicant or registrant of such action and is terminated at any time after entry of final judgment or decree in the case of judicial proceedings, final agency action in the case of administrative proceedings, and final disposition by a self-regulatory organization in the case of disciplinary proceedings.
3. A criminal prosecution is pending at any time after criminal charges are filed and is terminated at any time after conviction, acquittal, or dismissal.
Cited 25 times | Published | Supreme Court of Florida | 1996 WL 136914
...We emphasize the correctness of Judge Booth's conclusion that, while the burden of producing evidence may shift between the parties in an application dispute proceeding, the burden of persuasion remains upon the applicant to prove her entitlement to the license. Id. [2] The denial of registration pursuant to section 517.161(6)(a), Florida Statutes (1989), is not a sanction for the applicant's violation of the statute, but rather the application of a regulatory measure....
...Turlington, 510 So.2d 292, 294-95 (Fla. 1987). [2] Of course, upon appellate review, an administrative decision denying a license will not be sustained unless it can be demonstrated that the decision is supported by competent, substantial evidence present in the record. [3] See § 517.161(6)(a), Fla.Stat....
Cited 15 times | Published | Florida 1st District Court of Appeal | 1993 WL 288738
...nt his reregistration and continued ability to further engage in such fraudulent practices through his association with other registered securities dealers, and thereby prevent future clients such as Appellants from "fall[ing] victim to his scheme." Section 517.161 authorizes the Department to deny registration or to revoke, restrict, or suspend any registration previously granted if the Department determines, inter alia, that such associated person has violated any provision of chapter 517 or is guilty of any fraudulent act in connection with a sale of securities....
...would not have allowed Kury to reregister as an associated person and permit him to continue in the securities business without first instituting an investigation into whether Kury's reregistration should be denied, suspended, or revoked pursuant to section 517.161....
...some of the proceeds from the withdrawals for her own benefit and the remainder she deposited for the benefit of organizations in which she had an interest. The order then indicated that the Department was proceeding pursuant to sections 120.59(3), 517.161, and 517.221, Florida Statutes, included conclusions of law, recited the emergency nature of the order, and indicated that judicial review was available pursuant to section 120.68, Florida Statutes....
...ted by the statutes, each having slightly different initial emergency procedures. Review of both is substantially the same under chapter 120, Florida Statutes (1989). One action was the suspension of the privileges associated with registration under section 517.161(6)(b), and the other action was the cease and desist order under section 517.221, Florida Statutes (1989). An analysis of each is helpful. SUSPENSION OF REGISTRATION Section 517.161(6)(b) states: Any order of suspension or restriction under this subsection shall: 1....
...and acted upon. These statutes clearly indicate that, although a suspension may take effect upon issuance when an emergency situation is encountered, a formal or routine proceeding must be promptly initiated and acted upon. The hearing mentioned in section 517.161(6)(b) is not further described in chapter 517, but chapter 28-6, Licensing, Florida Administrative Code, prescribes the procedure to be followed in the revocation of a license....
...Not only has the Legislature not elected to provide a private remedy under section 517.03(1), but such relief would be superfluous and inefficient given the Department's broad enforcement powers and the already-existing extensive regulation of the securities markets. For example, section 517.161 permits the Department to revoke or suspend a previously-granted registration; section 517.191 and 517.201 empower the Department to investigate any act or practice constituting a violation of Chapter 517, and to seek injunctive or ot...
Cited 1 times | Published | Florida 1st District Court of Appeal | 1994 WL 646266
...ficer applied an improper burden of proof. Appellants applied for registration with the Department to deal in securities. [1] By letter of December 5, 1989, the Department notified appellants of its intent to deny the registration applications under section 517.161, Florida Statutes (1989), [2] based upon appellants' *247 having violated sections 517.12(1), 517.07, 517.301(1)(a)2, and 517.301(1)(c), Florida Statutes (1989)....
...rder. The Department denied the applications for registration, entered a final cease and desist order, and imposed a $5,000 fine for each of the four statutes appellants were found to have violated. We turn, then, to the issues raised by appellants. Section 517.161, Florida Statutes, under which the Department denied the applications for registration, permits, but does not require, the Department to deny an application upon proof that an applicant has violated one or more of the provisions of chapter 517....
...n the securities business in this state. This registration process is closely akin to, if not in fact, a licensure proceeding, because one is precluded from engaging in certain business activities unless validly registered by the state to do so. [2] Section 517.161, Florida Statutes (1989), in pertinent part: Revocation, denial, or suspension of registration of dealer, investment adviser, associated person, or branch office....
Cited 1 times | Published | Florida 1st District Court of Appeal | 1988 WL 125349
...istration as an associated person and an applicant previously registered seeking reaffiliation with a new firm, and to grant or deny both initial applications and applications for reaffiliation in the same manner based upon the criteria set forth in section 517.161, Florida Statutes....
...ormation during the renewal process and to stagger renewal dates to reduce the work load which would be occasioned by one single renewal date. Likewise, the Department has the authority to discipline existing registrants for the grounds set forth in section 517.161(1) at any time by utilizing the procedures set forth in the Administrative Procedures Act....
...Florida Statutes. Appellant argues that OFR cannot “rely on the clearly erroneous and unsubstantiated findings of a single arbitrator” to deny his application for registration. We conclude that the arbitration award satisfies the requirements of section 517.161(1), Florida Statutes (2011), which authorizes OFR to deny registration to one who has been the subject of a national securities association decision involving a violation of state securities law....
...On October 7, 2011, OFR issued and served on Appellant notice of its intent to deny the application for registration. The notice referred to the FINRA arbitration decision and the judgment confirming the award as grounds for denial. As authority for the denial, the notice cited inter alia, section 517.161(l)(m), Florida Statutes....
...y to do so. See Diaz v. Dep’t of Bus. & Prof l Reg., 21 So.3d 919, 920 (Fla. 3d DCA 2009); Fla. Admin. Code R. 28-106.111(4). Consequently, on appeal, he may only argue that the agency’s conclusions of law based on the facts are incorrect. 3 Section 517.161(l)(m), Florida Statutes (2011), permits OFR to deny registration to an applicant who: Has been the subject of any decision, finding, injunction, suspension, prohibition, revocation, denial, judgment, or administrative order by any cou...
...OFR concluded that Appellant “has been found by a national securities association ... to have violated provisions of Chapter 517, Florida Statutes, specifically Section 517.301 and 517.07, Florida Statutes, which [is] grounds for denial pursuant to [section] 517.161(l)(m), Florida Statutes.” We find no error in this conclusion....
...Finally, the arbitration award found that Appellant violated section 517.07, Florida Statutes, by selling unregistered securities, and violated section 517.301, Florida Statutes, by misrepresenting information in the course of securities transaction. Thus, the FIN-RA arbitration award satisfies the requirements of section 517.161(l)(m), and OFR appropriately relied on it to deny Appellant’s registration application....
...one at issue here, to deny registration to an applicant who was
found in a FINRA arbitration decision to have violated securities
laws.
6
In Wojnowski v. State, Office of Financial Regulation, this
court analyzed section 517.161(1)(m), Florida Statutes (2011),
which permitted the Office to deny registration to any applicant
who “‘[h]as been the subject of any decision . . . by any . . .
national securities . . . association, involving a violation of any
federal or state securities or commodities law . . . .’” 98 So. 3d
189, 191 (Fla. 1st DCA 2012) (quoting § 517.161(1)(m), Fla....
...the applicant had violated state securities laws, the State was
permitted to rely on the FINRA award to deny the applicant’s
registration application. Id.
Here, the language of section 626.621(13), Florida Statutes,
mirrors almost verbatim the language of section 517.161(1)(m),
Florida Statutes, analyzed in Wojnowski. Using a virtually
identical statute as its authority to do so, the Department
revoked Appellant’s license on the basis of FINRA’s finding that
Appellant violated securities laws. In Wojnowski, this court
noted that the language in section 517.161(1)(m), Florida
Statutes, broadly allowed the State to deny registration, if the
applicant had been “the subject of any decision” by an association
such as FINRA....
...Section 517.12(11), Florida Statutes (1987), states, “If the Department finds that the applicant is of good repute and character and has complied with the provisions of this section and the rules made pursuant hereto, it shall register the applicant.” Section 517.161(1), Florida Statutes (1987), provides in part that “Registration under s....
“[t]he denial of registration pursuant to section 517.161(6)(a), Florida Statutes (1989), is not a sanction
This Florida statute resource is curated by Graham W. Syfert, Esq., a Jacksonville, Florida personal injury and workers' compensation attorney. For legal consultation, call 904-383-7448.
