SENATE BILL REPORT

SB 5755

BYSenator Kreidler

Changing provisions relating to the enforcement of state securities laws.

Senate Committee on Financial Institutions

Senate Hearing Date(s):February 24, 1987; March 3, 1987

Majority Report:  That Substitute Senate Bill No. 5755 be substituted therefor, and the substitute bill do pass.

      Signed by Senators Moore, Chairman; Bender, Vice Chairman; Bottiger, Fleming, McDermott, Metcalf, Pullen.

Senate Staff:Stephanie Yates (786-7416)

                  March 5, 1987

AS REPORTED BY COMMITTEE ON FINANCIAL INSTITUTIONS, MARCH 3, 1987

BACKGROUND:

For a violation of the Washington Securities Act, a judge may grant an injunction, a restraining order, or a writ of mandamus to prevent further violation or to enforce compliance.

The Administrator of the Securities Division has no civil fining authority.  A person who violates the Washington Securities Act may be fined only upon criminal conviction for such violation.

The authority of the Securities Division to assist at trial in the criminal prosecution of a violation of the Washington Securities Act is implied in law.

SUMMARY:

In a court action brought by the Director of the Department of Licensing to enjoin a violation of, or enforce compliance with, the Washington Securities Act, a judge may grant additional relief that he or she deems necessary.

After notice and an opportunity for a hearing, the Administrator of the Securities Division may levy a fine against any person who has violated the Washington Securities Act or any rule or order.  The fine is not to exceed $5,000 per violation.

At the request of the prosecuting attorney, the Securities Division may assist at trial in the criminal prosecution of a violation of the Washington Securities Act or any rule or order.

Revenue:    yes

Fiscal Note:      none requested

EFFECT OF PROPOSED SUBSTITUTE:

Authority of a judge to grant additional relief in a securities enforcement action is deleted.

Authority of the Securities Division to levy civil fines is deleted.

Senate Committee - Testified: Senator Kreidler, sponsor; Leo Sweeney, Teamster Union; Ralph Smith, attorney; Leland Blankenship, resident