Idaho State Statutes - Idaho Attorney Directory

(a) Financial requirements.
Subject to section 15(h) of the securities exchange act of 1934 (15 U.S.C.
78o(h)) or section 222 of the investment advisers act of 1940 (15 U.S.C.
80b-22), a rule adopted or an order issued under this chapter may establish
minimum financial requirements for broker-dealers registered or required to be
registered under this chapter and investment advisers registered or required
to be registered under this chapter.
(b) Financial reports. Subject to section 15(h) of the securities
exchange act of 1934 (15 U.S.C. 78o(h)) or section 222(b) of the investment
advisers act of 1940 (15 U.S.C. 80b-22), a broker-dealer registered or
required to be registered under this chapter and an investment adviser
registered or required to be registered under this chapter shall file such
financial reports as are required by a rule adopted or an order issued under
this chapter. If the information contained in a record filed under this
subsection is or becomes inaccurate or incomplete in a material respect, the
registrant shall promptly file a correcting amendment.
(c) Recordkeeping. Subject to section 15(h) of the securities exchange
act of 1934 (15 U.S.C. 78o(h)) or section 222 of the investment advisers act
of 1940 (15 U.S.C. 80b-22):
(1) A broker-dealer registered or required to be registered under this
chapter and an investment adviser registered or required to be registered
under this chapter shall make and maintain the accounts, correspondence,
memoranda, papers, books and other records required by a rule adopted or
an order issued under this chapter;
(2) Broker-dealer records required to be maintained under subsection
(c)(1) of this section may be maintained in any form of data storage
acceptable under section 17(a) of the securities exchange act of 1934 (15
U.S.C. 78q(a)) if they are readily accessible to the administrator; and
(3) Investment adviser records required to be maintained under subsection
(c)(1) of this section may be maintained in any form of data storage
required by a rule adopted or an order issued under this chapter.
(d) Audits or inspections. The records of every person issuing or
guaranteeing any securities subject to the provisions of this chapter, if such
person is registered or required to be registered under this chapter, and of
every broker-dealer, agent, investment adviser or investment adviser
representative registered or required to be registered under this chapter are
subject to such reasonable periodic, special or other audits or inspections by
a representative of the administrator, within or without this state, as the
administrator considers necessary or appropriate in the public interest and
for the protection of investors. An audit or inspection may be made at any
time and without prior notice. The administrator may copy, and may remove for
audit or inspection copies of, all records the administrator reasonably
considers necessary or appropriate to conduct the audit or inspection. The
administrator may assess a reasonable charge for conducting an audit or
inspection under this subsection.
(e) Custody and discretionary authority bond or insurance. Subject to
section 15(h) of the securities exchange act of 1934 (15 U.S.C. 78o(h)) or
section 222 of the investment advisers act of 1940 (15 U.S.C. 80b-22), a rule
adopted or an order issued under this chapter may require a broker-dealer or
investment adviser that has custody of or discretionary authority over funds
or securities of a customer or client to obtain insurance or post a bond or
other satisfactory form of security in an amount not to exceed twenty-five
thousand dollars ($25,000). The administrator may determine the requirements
of the insurance, bond or other satisfactory form of security. Insurance or a
bond or other satisfactory form of security may not be required of a
broker-dealer registered under this chapter whose net capital exceeds, or of
an investment adviser registered under this chapter whose minimum financial
requirements exceed, the amounts required by rule or order under this chapter.
The insurance, bond or other satisfactory form of security must permit an
action by a person to enforce any liability on the insurance, bond or other
satisfactory form of security if instituted within the time limitations in
section 30-14-509(j)(2), Idaho Code.
(f) Requirements for custody. Subject to section 15(h) of the securities
exchange act of 1934 (15 U.S.C. 78o(h)) or section 222 of the investment
advisers act of 1940 (15 U.S.C. 80b-22), an agent may not have custody of
funds or securities of a customer except under the supervision of a
broker-dealer and an investment adviser representative may not have custody of
funds or securities of a client except under the supervision of an investment
adviser or a federal covered investment adviser. A rule adopted or an order
issued under this chapter may prohibit, limit, or impose conditions on a
broker-dealer regarding custody of funds or securities of a customer and on an
investment adviser regarding custody of securities or funds of a client.
(g) Investment adviser brochure rule. With respect to an investment
adviser registered or required to be registered under this chapter, a rule
adopted or an order issued under this chapter may require that information or
other record be furnished or disseminated to clients or prospective clients in
this state as necessary or appropriate in the public interest and for the
protection of investors and advisory clients.
(h) Continuing education. A rule adopted or an order issued under this
chapter may require an individual registered under section 30-14-402 or
30-14-404, Idaho Code, to participate in a continuing education program
approved by the securities and exchange commission and administered by a
self-regulatory organization or, in the absence of such a program, a rule
adopted or an order issued under this chapter may require continuing education
for an individual registered under section 30-14-404, Idaho Code.

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