Chap. 236.—An ACT to amend and re-enact section 6 of an act entitled “an act to
prevent unfairness, imposition or fraud in the sale or disposition of certain
“securities” herein defined by requiring an inspection thereof, providing for
such inspection, supervision and regulation of the business of any person,
association, partnership, or corporation, engaged or intending to engage,
whether as principal, broker or agent, in the sale of any such securities in the
State of Virginia as may be necessary to prevent unfairness, imposition or
fraud in the sale or disposition of said securities, and precribing penalties for
the violation thereof,’ approved March 23, 1918, as heretofore amended.

[S B 335]

Approved March 23, 1932

1. Be it enacted by the general assembly of Virginia, That section
six of an act entitled “an act to prevent unfairness, imposition or fraud
in the sale or disposition of certain “securities” herein defined by
requiring an inspection thereof, providing for such inspection, super-
vision and regulation of the business of any person, association, partner-
ship, or corporation, engaged or intending to engage, whether as prin-
cipal, broker or agent, in the sale of any such securities in the State
of Virginia as may be necessary to prevent unfairness, imposition or
fraud in the sale or disposition of said securities, and prescribing
penalties for the violation thereof,’ approved March twenty-third,
nineteen hundred and eighteen, as heretofore amended, be amended
and re-enacted so as to read as follows: ,

Section 6. The State corporation commission shall have jurisdiction
at the instance of any resident of this State, upon affidavit by such
resident duly sworn to, or of its own motion, and upon such facts and
established in such manner, as required in a court of equity, for pur-
poses of an injunction, after at least five days’ notice to the party
defendant and an opportunity to be heard, said notice to be accom-
panied by a statement of the facts and charges upon which action is
proposed, to issue a cease and desist order in the nature of a temporary
injunction and restraining order in the matter of and against any
person, firm, corporation, society, or association, which it appears from
the facts is offering for sale, advertising for sale, or otherwise promot-
ing or assisting, participating in or acting in furtherance of the offering,
advertising, selling or otherwise promoting any securities or land which
should be qualified and which are not, and/or in any case in which it
appears that a fraud, legal or equitable, intentional or unintentional, is
being perpetrated and/or attempted in connection with the disposition
or attempted disposition of securities, or out of State land, to the
public, whether the provisions of this act as to qualification or notifica-
tion apply or not, and even though one or more of the exemptions or
exceptions under this act should be applicable, and even though quali-
fication or registration under the provisions of this act has been
effected, enjoining and restraining such person, firm, corporation,
society or association, from further offering, advertising, selling, or
promoting, assisting or participating in or acting in furtherance of such
offer, advertisement, or sale and if said cease and desist order is issued
it shall thereafter proceed as soon as may be after due notice and
after a full hearing on the merits to consider and determine whether
or not such cease and desist, or restraining order, and injunction shall
be dismissed or made permanent, and its action, subject to right of
appeal, shall be conclusive in any court in the State in any matter, civil
or criminal upon the same state of facts. The proceeding shall be
analogous to and in accordance with proceedings in equity for in-
junctions, except as otherwise specifically provided, and the commis-
sion in this connection shall have power and authority to require a
bond with surety in accordance with the principles applicable in the
courts of equity of this State, and it shall have power and authority
to exercise a sound, judicial and equitable discretion in the adminis-
tration of these and all other provisions of this act with a view to the
accomplishment of that measure of protection to the public contem-
plated by this act with as little interference with legitimate business
as is consistent with the accomplishment of the objects of this
legislation.

In any case in which it is made to appear, or the commission has
reason to believe from facts before it, that a proceeding should be
instituted to determine whether a cease and desist order or injunction
should issue in accordance with provisions of this section and service
upon the person or persons, firm, corporation, society, association, or
any agent or representative cannot be had because the offering is by
advertisement and/or solicitation through periodicals, mail, telephone,
telegraph, radio, or other means of communication from beyond the
limits of the State, or the person or persons who appear to have
personally violated the law within the limits of the State have left the
jurisdiction of the State temporarily or permanently, or the original
and at least one alias process have been returned not found, jurisdic-
tion may be obtained through the medium of at least ten days’ notice
instead of five by registered mail, return receipt demanded, to the
address or addresses of such person or persons, firms, corporation,
society or association insofar as such address or addresses shall be
known or shall be available or by publication of notice in a newspaper
published in the city of Richmond of general circulation in the State,
beginning at least ten days prior to the date set for hearing, and, in
case of nonappearance in response to such notice, or in case of special
appearance, and after full hearing upon the merits, the commission
may issue a cease and desist order, in the nature of a temporary in-
junction, and/or a permanent injunction, in accordance with the preced-
ing provisions of this section where service is had or general appear-
ance is made, and forward by registered mail, return receipt demanded,
attested copies of such order to the same addresses or such later ad-
dresses as may become known and give such other publicity as it may
see fit, and in case no addresses were known or shall have become
known such publicity as the commission may see fit shall be given to
such order, including notice in either case to the public through the
press or otherwise as the commission may, in its discretion, determine
to be advisable for the reasonable information and protection of the
public.

The provisions of this section, as amended, are subject to the follow-
ing provisos: Nothing herein shall be construed as being applicable, as an
offeror, solicitor, or advertiser of any securities or out of the State land
to the publisher of any newspaper or periodical admitted to second
class mailing privileges under the United States postal laws except and
until the notice provided for in section two hereof shall have been given
by the commission, and further, nothing herein shall be construed, so
as to, in any way, impair, or infringe upon the right of any citizen or
resident, natural or corporate, or person or corporation temporarily
within the State of Virginia to offer, of his, her, or its own initiative,
to subscribe for, order, or buy from any nonresident person, firm,
corporation, or association, any security or out of the State land which
any such citizen, resident or temporary sojourner may desire to sub-
scribe for, order or buy.

Any order that may be entered as the basis of the institution of a
proceeding under this section and the issuing of the at least five or ten
days’ notice, as the case may be, in the discretion of the commission
may be kept on the secret docket and not made public until after the
preliminary or final hearing, as the commission may determine.