HOUSE BILL ANALYSIS

                 SSB 5928

Title:  An act relating to good faith communications to self‑regulatory organizations delegated authority by government agencies.

Brief Description:  Extending immunity from liability to those who communicate a complaint or information to self‑regulatory agencies.

Sponsors:  Senate Committee on Judiciary (originally sponsored by Senator Prentice).

                    Brief Summary of Bill

CProvides immunity to individuals who communicate a complaint or information to self-regulatory agencies.

HOUSE COMMITTEE ON JUDICIARY

Staff:  Jim Morishima (786-7191).

Background:

A person who in good faith communicates a complaint or information to any federal, state, or local governmental agency is immune from civil liability for any claim relating to that communication.  However, there is no comparable immunity for communications made to a non-governmental, self-regulatory agency, even if the agency=s authority has been delegated by a governmental entity and the governmental entity has oversight over the agency.

One such self-regulatory agency is the National Association of Securities Dealers (NASD).  All securities professionals and firms must register with the NASD.  The NASD operates under authority delegated by the Securities and Exchange Commission (SEC) and is subject to the oversight of the SEC.

Summary of Bill:

A person who in good faith communicates a complaint or information to any self-regulatory agency is immune from civil liability for any claim relating to that communication if:

Cthe self-regulatory agency regulates persons involved in the securities or futures business;

Cthe self-regulatory agency has been delegated its authority by a federal, state, or local government agency; and

Cthe self-regulatory agency is subject to the oversight of the delegating agency.

Fiscal Note:  Not requested.

Effective Date:  Ninety days after adjournment of session in which bill is passed.

                 Office of Program Research