About the Securities Division

What Can the Securities Division Do For You?

While we can’t eliminate all risks inherent in an investment, we offer various services to help reduce it. We encourage you to contact your broker-dealer or investment adviser firm directly if you have any concerns with your accounts. We can help:

• Review securities offering documents
• Consult with small businesses about securities laws
• Check status of persons offering or selling securities, including disciplinary history
• Check status of persons giving investment advice, including disciplinary history
• Investigate tips and complaints about potential violations of law
• Answer investor inquiries by telephone and/or in person
• Render interpretative opinions
• Make available copies of public records on securities offerings and registration status of investment professionals
• Provide free investor education materials

We also welcome any information about potential violations of state securities laws. You can use our online complaint form to submit an inquiry. We’re also available each day to speak with investors about their concerns. You can contact us at:

Massachusetts Securities Division
1 Ashburton Place
Boston, MA 02108
Telephone: 617-727-3548
Toll-free: 800-269-5428
Email: securities@sec.state.ma.us
Fax: 617-248-0177

We accept anonymous inquiries. Depending on the circumstances of the inquiry, we may begin an investigation. If we uncover violations of the law, we may pursue administrative actions or refer cases for criminal prosecution.

Functions of the Securities Division

Corporate Finance

Through our Corporate Finance section, we protect against investor fraud with the following services:

• Reviewing offering materials to ensure full and fair disclosure and readability
• Preventing offerings which by their terms would result in abuses of investors
• Assisting small business offerors
• Educating investors

Registration, Inspection, Compliance and Examinations (RICE) Section

Through our Registration, Inspections, Compliance and Examinations (RICE) section, we register and regulate broker-dealers, agents, investment advisers, investment adviser representatives, and exempt reporting advisers. We collect initial and annual registration fees from these groups and responds to public inquiries about potential Securities Act violations.

• Any firm or individual offering and selling securities (or investment advice on securities) for compensation in the Commonwealth must register with (or notify) us — unless they have an exemption.
• Individuals must pass one or more comprehensive examinations before registering.
• Firms must comply with specific record-keeping requirements and demonstrate minimum financial solvency.
• Our RICE team determines whether a firm or individual may qualify for registration. We base this evaluation on several factors, including any past disciplinary history or client complaints.

We also inspects state-registered investment advisers for compliance with state and federal securities laws and regulations. These inspections ensure that investment advisers meet their clients’ obligations.

• We may conduct these inspections at investment adviser offices, with or without prior notice.
• Among many items, we review the verification and valuation methods for client assets, the financial solvency of firms, advertising and communications with clients, and the calculation of any client performance reports.
• We may discipline investment advisers who violate regulations or fail their duties to clients.

Enforcement

Through our Enforcement section, we aim to prevent, detect, and address violations of the laws and regulations. We can impose administrative sanctions on violators, including:

• Denying, revoking, or suspending registration for a broker-dealer, agent, investment adviser or investment adviser representative
• Issuing cease and desist orders prohibiting or suspending securities sales
• Issuing orders denying or revoking registration of securities
• Issuing orders revoking securities registration exemptions

We also investigate and litigate cases involving violations of the Massachusetts Uniform Securities Act.

When warranted, we can issue administrative proceedings to prevent future infractions or address prior violations. We may also refer cases to local, state and federal law enforcement agencies for criminal prosecution.

Interpretive Opinions

Our General Counsel responds to public inquiries about securities laws and regulations, and issues written interpretative opinions to assist with compliance. Our attorneys can also answer legal questions from the public via phone, email, or in-person visit.

Public Records Requests

We can provide registration status and disciplinary records about broker-dealers, agents, investment advisers, and investment adviser representatives. Contact Sofya Gray, Records Access Officer at 617-878-3660 or via email at sec.rao@sec.state.ma.us.