Bill Text: NJ S1745 | 2010-2011 | Regular Session | Introduced
Bill Title: Prohibits misleading use of senior-specific certifications or professional designations in connection with sales of securities.
Spectrum: Strong Partisan Bill (Democrat 10-1)
Status: (Passed) 2010-07-02 - Approved P.L.2010, c.41. [S1745 Detail]
Download: New_Jersey-2010-S1745-Introduced.html
Sponsored by:
Senator JIM WHELAN
District 2 (Atlantic)
Senator THOMAS H. KEAN, JR.
District 21 (Essex, Morris, Somerset and Union)
Co-Sponsored by:
Senator Scutari
SYNOPSIS
Prohibits misleading use of senior-specific certifications or professional designations in connection with sales of securities.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning sales of securities and supplementing P.L.1967, c.93 (C.49:3-47 et seq.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. It shall be unlawful for any person to use a certification or professional designation to indicate or imply that the user has special training in advising or servicing senior citizens or retirees (hereinafter, a "senior-specific certification or professional designation"), in such a way as to mislead any person, in connection with the offer, sale, or purchase of a security, or the provision of advice as to the value of or the advisability of investing in, purchasing, or selling a security, either directly or indirectly or through a publication or a writing, or by issuing or promulgating an analysis or report relating to a security.
b. Uses of a senior-specific certification or professional designation that shall be unlawful pursuant to subsection a. of this section shall include, but shall not be limited to, the use of:
(1) a certification or professional designation by a person who has not actually earned or who is otherwise ineligible to use that certification or professional designation;
(2) a nonexistent or self-conferred certification or professional designation;
(3) a certification or professional designation that indicates or implies a level of occupational qualifications obtained through education, training, or experience that the person using the certification or professional designation does not have; and
(4) a certification or professional designation that was obtained from a certifying or designating organization that:
(a) is primarily engaged in the business of instruction in sales or marketing;
(b) does not have reasonable standards or procedures for assuring the competency of its certificants or designees;
(c) does not have reasonable standards or procedures for monitoring and disciplining its certificants or designees for improper or unethical conduct; or
(d) does not have reasonable continuing education requirements for its certificants or designees in order to maintain the certificate or designation.
c. A rebuttable presumption that a certifying or designating organization is not included as an organization to which paragraph (4) of subsection b. of this act is applicable shall exist, if the organization has been accredited by:
(1) the American National Standards Institute;
(2) the National Commission for Certifying Agencies; or
(3) an organization that is on the United States Department of Education's list entitled "Accrediting Agencies Recognized for Title IV Purposes" and the certification or professional designation issued by the organization does not primarily apply to sales or marketing.
d. In determining whether a combination of words, or an acronym standing for a combination of words, constitutes a senior-specific certification or professional designation, factors to be considered shall include:
(1) use of one or more words such as "senior," "retirement," "elder," or like words, combined with one or more words such as "certified," "registered," "chartered," "adviser," "specialist," "consultant," "planner," or like words, in the name of the certification or professional designation; and
(2) the manner in which those words are combined.
e. For purposes of this act, a senior-specific certification or professional designation shall not include a job title within an organization that is licensed or registered by a state or federal financial services regulatory agency, if that job title:
(1) indicates seniority or standing within the organization; or
(2) specifies an individual's area of specialization within the organization.
For purposes of this subsection, "financial services regulatory agency" shall include, but shall not be limited to, an agency that regulates brokers, dealers, investment advisers, or investment companies as defined pursuant to the federal "Investment Advisers Act of 1940" (15 U.S.C. s.80b-1 et seq.) or the federal "Investment Company Act of 1940" (15 U.S.C. s.80a-1 et seq.).
2. This act shall take effect immediately.
STATEMENT
This bill supplements the "Uniform Securities Law (1997)" and makes it unlawful for any person to use a senior-specific certification or designation to indicate or imply that the user has special training in advising or servicing senior citizens or retirees, in such a way as to mislead any person, in connection with the offer, sale, or purchase of a security, or the provision of advice as to the value of or the advisability of investing in, purchasing, or selling a security, either directly or indirectly or through a publication or a writing, or by issuing or promulgating an analysis or a report relating to a security.
The bill specifies certain prohibited uses of a senior-specific certification or professional designation which include, but which are not limited to, use of:
(1) a certification or professional designation by a person who has not actually earned or is otherwise ineligible to use such certification or designation;
(2) a nonexistent or self-conferred certification or professional designation;
(3) a certification or professional designation that indicates or implies a level of occupational qualifications obtained through education, training, or experience that the person using the certification or professional designation does not have; and
(4) a certification or professional designation that was obtained from a certifying or designating organization that does not meet certain criteria as specified in the bill.
The bill further provides that in determining whether a combination of words, or an acronym standing for a combination of words, constitutes a senior-specific certification or professional designation, the use of certain words, as specified in the bill, and the manner in which these words are combined, shall be considered factors in the determination.
Finally, the bill provides that a senior-specific certification or professional designation shall not include a job title within an organization that is licensed or registered by a state or federal financial services regulatory agency, in situations in which that job title indicates seniority or standing within the organization, or specifies an individual's area of specialization within the organization.
As the bill supplements the "Uniform Securities Law (1997)," the Bureau of Securities in the Division of Consumers Affairs of the Department of Law and Public Safety will administer the provisions of the bill, and any person who violates any of the bill's provisions will be subject to liability under the civil and criminal penalties currently provided for in the "Uniform Securities Law (1997)."
