In Illinois, investors have rights and protections under numerous laws and regulations.
The Illinois Securities Act (ISA) is a state law that regulates the offer and sale of securities in Illinois. The ISA is modeled after the Uniform Securities Act (USA), which is a model law adopted by many states.
The ISA defines a security as "any note, stock, bond, debenture, evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement, investment contract, or any other investment security, or any interest or instrument commonly known as a security."
The ISA requires that all securities offered or sold in Illinois be registered with the Illinois Secretary of State (SOS), unless an exemption applies. The exemptions are designed to allow for the sale of securities without registration in certain limited circumstances, such as when the securities are offered to a small number of investors or when they are offered through an established securities exchange.
The ISA also prohibits certain fraudulent and deceptive practices in connection with the sale of securities. These prohibited practices include making false or misleading statements about a security, omitting material information about a security, and engaging in manipulative or deceptive trading practices.
Private securities attorneys and the SOS are responsible for enforcing the ISA. The SOS has the authority to investigate violations of the Act, to bring civil and criminal actions against violators, and to revoke the registration of securities professionals.
Here are some of the key provisions of the ISA:
Securities must be registered with the SOS before they can be offered or sold in Illinois.
There are a number of exemptions from registration, such as for securities offered to a small number of investors or through an established securities exchange.
Fraudulent and deceptive practices in connection with the sale of securities are prohibited.
The SOS is responsible for enforcing the ISA.
Here are some additional resources:
Illinois Secretary of State: https://www.ilsos.gov/departments/securities/abtil.html
In addition to Illinois Securities Act, investors are also protected by the following federal laws:
Contract us to discuss your rights and options for recovering investment losses.