Procedure when assets or capital of broker-dealer or investment adviser found impaired
- • involuntary liquidation
(1) When the Director of the Department of Consumer and Business Services ascertains that the assets or capital of any broker-dealer not otherwise registered under section 15 of the Securities Exchange Act of 1934, as amended, or state investment adviser that has its principal place of business in this state are impaired, or that such person’s affairs are in an unsound condition, the director may take possession of all the property, business and assets of such person located in this state and retain possession of them pending the further proceedings specified in this section. The director shall inventory the assets and liabilities of such person. The director shall file one copy of the inventory in the office of the director and one copy in the office of the clerk of the circuit court of the county in which the principal place of business of such person is located, and shall mail one copy to each shareholder or partner of such person at the last-known address of the shareholder or partner. The clerk of the court shall file the inventory as a pending proceeding and give it a case number.
(2) If any person refuses to permit the director to take such possession, the director may apply to the circuit court of the county in which the principal place of business of such person is located for an order appointing a receiver, who may be the director, to take such possession.
(3) If the deficiency in assets or capital has not been made good or the unsound condition remedied within 60 days from the date when the director or receiver took possession, the property, business and assets of such person located in this state shall be liquidated. If a receiver has not been appointed, the director shall apply for such appointment by the court in which the inventory was filed. The liquidation shall proceed as provided by law for liquidation of a private corporation in receivership.
(4) The expenses of the receiver and compensation of counsel, as well as all expenditures required in the liquidation proceedings, shall be fixed by the director, subject to the approval of the court, and, upon certification by the director, shall be paid out of the funds in the hands of the director as such receiver. [1967 c.537 §24; 1987 c.603 §18; 1993 c.508 §38; 1997 c.772 §24; 2003 c.576 §186]
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