Yesterday, the California Corporations Commissioner Jan Owen gave notice that she will file on April 4, 2012 an emergency regulation extending the effectiveness of Rule 260.204.9 of Title 10 of the California Code of Regulations. Rule 260.204.9 currently exempts from registration investment advisers who are deemed “private advisers.” This emergency regulatory action will become effective on April 17, 2012, the same day as the expiration of the current emergency regulation, and will expire on July 16, 2012. Yesterday’s action was a welcome move by the Commissioner and will ensure some stability as she proceeds with the ongoing rule making process for permanent rule changes.
On the enforcement side, Commissioner Owen also recently filed a civil complaint and obtained a Temporary Restraining Order, Asset Freeze and Appointment of a Receiver against numerous defendants. According to the Commissioner’s complaint, the defendants raised approximately $10,000,000 from the unqualified sales of securities. The Commissioner further alleges that over 200 investors were involved.
