Cal. Code Regs. Tit. 10, § 260.216.7 - Control of the Market

Current through Register 2022 Notice Reg. No. 16, April 25, 2022

The phrase "manipulative, deceptive, or other fraudulent scheme, device, or contrivance," as used in subdivision (a) of Section 25216 of the Code, is hereby defined to include any representation made to a customer by a broker-dealer or agent that any security is being offered to such customer "at the market" or at a price related to the market price unless such broker-dealer or agent knows or has reasonable grounds to believe that a market for such security exists other than that made, created, or controlled by such person, or by any person for whom such person is acting or with whom such person is associated, or by any person controlled by, controlling, or under common control with such person. A written notification to a customer at or prior to the completion of the transaction that a broker-dealer making the principal market in a security may be in control of the market, by virtue of the fact that such person is the only broker-dealer regularly appearing in the sheets or by reason of the volume of such person's transactions in relation to the total volume of trading by all broker-dealers, shall be sufficient to negative any representation which might otherwise be implied that such person is selling "at the market."

Notes

Cal. Code Regs. Tit. 10, § 260.216.7

Note: Authority cited: Sections 25216(a) and 25610, Corporations Code. Reference: Section 25216, Corporations Code.

1. Editorial correction filed 11-9-82 (Register 82, No. 46).

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