Bill Text: IA HF2239 | 2017-2018 | 87th General Assembly | Enrolled
Bill Title: A bill for an act relating to noninsurance business transactions regulated by the insurance division of the department of commerce, by providing for regulated securities and exchanges, and financial records associated with the sale of cemetery and funeral merchandise and services. (Formerly HSB 584.) Effective 7-1-18.
Spectrum: Committee Bill
Status: (Passed) 2018-04-04 - Signed by Governor. H.J. 752. [HF2239 Detail]
Download: Iowa-2017-HF2239-Enrolled.html
House File 2239 - Enrolled
HOUSE FILE
BY COMMITTEE ON COMMERCE
(SUCCESSOR TO HSB 584)
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A BILL FOR
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House File 2239
AN ACT
RELATING TO NONINSURANCE BUSINESS TRANSACTIONS REGULATED
BY THE INSURANCE DIVISION OF THE DEPARTMENT OF COMMERCE,
BY PROVIDING FOR REGULATED SECURITIES AND EXCHANGES, AND
FINANCIAL RECORDS ASSOCIATED WITH THE SALE OF CEMETERY AND
FUNERAL MERCHANDISE AND SERVICES.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
DIVISION I
IOWA UNIFORM SECURITIES ACT
Section 1. Section 502.202, subsection 2, paragraph e,
subparagraph (1), Code 2018, is amended to read as follows:
(1) The issuer of the security has a class of equity
securities listed on a national securities exchange registered
under section 6 of the Securities Exchange Act of 1934
or designated for trading on the national association of
securities dealers automated quotation system.
Sec. 2. Section 502.202, subsection 24, paragraph a, Code
2018, is amended to read as follows:
a. Definitions. As used in this subsection, unless the
context otherwise requires:
(1) "Intermediary" means a any of the following:
(a) A broker=dealer that is subject to the registration
requirements of section 502.401 and that facilitates the offer
and sale of securities by issuers to investors through an
internet=based system that is open to and accessible by the
general public.
(b) "Intermediary" also means an entity registered with
the administrator as an Iowa crowdfunding portal. A business
entity that is all of the following:
(i) A funding portal that is registered with the securities
and exchange commission pursuant to the Securities Act of 1933,
including as provided in 15 U.S.C. {77d=1.
(ii) A member of the financial industry regulatory
authority, inc. pursuant to the Securities Exchange Act of
1934, including as provided in 15 U.S.C. {{78c and 78o=3, and
17 C.F.R. {227.400.
(c) A business entity that qualifies as an Iowa crowdfunding
portal by meeting all of the following requirements:
(i) Is registered with the administrator as required by the
administrator.
(ii) Is engaged in intrastate crowdfunding offers and sales
of exempt securities in this state through an internet site.
(iii) Does not operate or facilitate a secondary market in
securities.
(2) "Intrastate crowdfunding" means the offer or sale of
a security by an issuer in a transaction that is available
for purchase only by an Iowa residents and by resident or a
business organizations located in, and organized and registered
under the laws of, entity having its principal place of
business in this state.
(3) "Iowa crowdfunding portal" means an entity incorporated
or organized under the laws of this state, authorized to do
business in this state, and engaged exclusively in intrastate
crowdfunding offers and sales of exempt securities in this
state through an internet site and which does not operate or
facilitate a secondary market in securities.
Sec. 3. Section 502.202, subsection 24, paragraph c, Code
2018, is amended to read as follows:
c. Aggregate sales limit. The aggregate amount of
securities sold to all investors by the issuer during the
twelve=month period preceding the date of the offer or sale,
including any amount sold in reliance upon the exemption in
this subsection, shall not exceed one five million dollars
other than either of the following:
(1) Securities sold to Iowa resident institutional
investors.
(2) Securities sold to the Iowa resident issuer's
management.
Sec. 4. Section 502.302, subsection 3, Code 2018, is amended
to read as follows:
3. Notice filings for federal covered securities under
section 18(b)(4)(D) 18(b)(4)(F). With respect to a security
that is a federal covered security under section 18(b)(4)(D)
18(b)(4)(F) of the Securities Act of 1933, 15 U.S.C.
{77r(b)(4)(D) {77r(b)(4)(F), a rule under this chapter may
require a notice filing by or on behalf of an issuer to include
a copy of form D, including the appendix, as promulgated by the
securities and exchange commission, and a consent to service
of process complying with section 502.611 signed by the issuer
not later than fifteen days after the first sale of the federal
covered security in this state and the payment of a fee of one
hundred dollars; and the payment of a fee of two hundred fifty
dollars for any late filing.
Sec. 5. Section 502.406, subsection 5, Code 2018, is amended
to read as follows:
5. Additional conditions or waivers. A rule adopted
or order issued under this chapter may impose such other
conditions, not inconsistent with the National Securities
Markets Improvement Act of 1996. An order or rule issued
under this chapter may waive, in whole or in part, specific
requirements in connection with registration as are in the
public interest and for the protection of investors.
DIVISION II
VIATICAL SETTLEMENT ACT
Sec. 6. Section 508E.15, subsection 4, paragraph a,
subparagraph (4), Code 2018, is amended to read as follows:
(4) The national association of insurance commissioners;
the national association of securities dealers the financial
industry regulatory authority, inc.; the North American
securities administrators association; their employees, agents,
or representatives; or other regulatory body overseeing life
insurance, viatical settlements, securities, or investment
fraud.
DIVISION III
IOWA CEMETERY AND FUNERAL MERCHANDISE AND FUNERAL SERVICES ACT
Sec. 7. Section 523A.207, Code 2018, is amended to read as
follows:
523A.207 Audits Report by certified public accountants ==
penalty penalties == waiver == confidentiality.
1. A purchase agreement shall not be sold or transferred,
as part of the sale of a business or the assets of a business,
until an audit has been performed by a certified public
accountant has completed an agreed=upon procedures engagement
in accordance with the attestation standards established by the
American institute of certified public accountants and a report
is filed with the commissioner that expresses the auditor's
opinion of factual findings and results of applying the
agreed=upon procedures that verifies the adequacy or inadequacy
of funding related to the purchase agreements to be sold or
transferred.
2. If the buyer of a purchase agreement sold or transferred
as part of the sale of a business or the assets of a business,
fails to file such an audit a report described in subsection 1,
the commissioner shall may suspend the preneed seller's license
of the buyer and the preneed sales license of any sales agent
in the employ of the buyer until the audit report is filed. In
addition, the commissioner shall may assess a penalty against
the buyer in an amount up to one hundred dollars for each
day that the audit report remains unfiled. The commissioner
shall allow a thirty=day grace period after the date that a
purchase agreement is sold or transferred before suspension
of a license or assessment of a penalty for failure to file
an audit pursuant to this subsection the report. Upon good
cause, the commissioner may issue an order waiving the report
requirements.
2. 3. All records maintained by the commissioner under
this section shall be confidential pursuant to section 22.7,
subsection 58, and shall not be made available for inspection
or copying except upon approval of the commissioner or the
attorney general, or except when sought by the preneed seller
to whom the records relate. Such records shall be privileged
and confidential in any judicial or administrative proceeding
except any of the following:
a. An action commenced by the commissioner.
b. An administrative proceeding brought by the insurance
division.
c. An action or proceeding which arises out of the criminal
provisions of the laws of this state or of the United States.
d. An action brought by the insurance division or
the attorney general to recover moneys for embezzlement,
misappropriation, or misuse of trust funds.
LINDA UPMEYER
CHARLES SCHNEIDE
CARMINE BOAL
KIM REYNOLDS
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