17-12a502.   Prohibited conduct in providinginvestment advice.(a) Fraud in providing investment advice. It isunlawful for a person that advises others for compensation, eitherdirectly or indirectly or through publications or writings, as tothe value of securities or the advisability of investing in,purchasing, or selling securities or that, for compensation and aspart of a regular business, issues or promulgates analyses orreports relating to securities:

      (1)   To employ a device, scheme, or artifice to defraud anotherperson; or

      (2)   to engage in an act, practice, or course of business thatoperates or would operate as a fraud or deceit upon another person.

      (b)   Rules defining fraud. A rule adopted under this act maydefine an act, practice, or course of business of an investmentadviser or an investment adviser representative, other than asupervised person of a federal covered investment adviser, asfraudulent, deceptive, or manipulative, and prescribe meansreasonably designed to prevent investment advisers and investmentadviser representatives, other than supervised persons of a federalcovered investment adviser, from engaging in acts, practices, andcourses of business defined as fraudulent, deceptive, ormanipulative.

      (c)   Rules specifying contents of advisory contract. A ruleadopted under this act may specify the contents of an investment advisorycontract entered into, extended, or renewed by aninvestment adviser.

      History:   L. 2004, ch. 154, § 31; July 1, 2005.