CHAPTER 1. RESTITUTION FOR VICTIMS OF SECURITIES VIOLATIONS
IC 23-20
ARTICLE 20. VICTIMS OF SECURITIES
VIOLATIONS
IC 23-20-1
Chapter 1. Restitution for Victims of Securities Violations
IC 23-20-1-1
"Claimant"
Sec. 1. (a) As used in this chapter, "claimant" means a victim
filing an application for restitution assistance under this chapter.
(b) The term includes:
(1) a named party in an award;
(2) the executor of a named party in an award; or
(3) the heirs and assigns of a named party in an award.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-2
"Division"
Sec. 2. As used in this chapter, "division" refers to the securities
division of the office of the secretary of state.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-3
"Fund"
Sec. 3. As used in this chapter, "fund" refers to the securities
restitution fund established by section 25 of this chapter.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-4
"Out-of-pocket loss"
Sec. 4. As used in this chapter, "out-of-pocket loss" means an
amount equal to the amount of restitution ordered under any of the
following:
(1) A final court order.
(2) A final administrative order.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-5
"Person"
Sec. 5. As used in this chapter, "person" includes a sole
proprietorship, a partnership, a corporation, an association, a
fiduciary, or an individual.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-6
"Securities violation"
Sec. 6. As used in this chapter, "securities violation" means a
violation of the following:
(1) The Securities Act of 1933, as amended, and any regulations
related to that act.
(2) The Securities Exchange Act of 1934, as amended, and any
regulations related to that act.
(3) The Investment Company Act of 1940, as amended, and any
regulations related to that act.
(4) The Investment Advisers Act of 1940, as amended, and any
regulations related to that act.
(5) The Indiana uniform securities act and any rules related to
that act.
(6) Other state securities acts and any rules or regulations
related to those acts.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-7
"Victim"
Sec. 7. As used in this chapter, "victim" means an individual who
suffers monetary injury as a result of a securities violation.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-8
Duties of division
Sec. 8. The division shall do the following:
(1) Prescribe forms for processing applications for restitution
assistance.
(2) Determine whether a claim for restitution assistance filed
under this chapter should be awarded.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-9
Order awarding restitution to claimant required
Sec. 9. The division shall require a claimant to produce a copy of:
(1) a court order; or
(2) an administrative order;
that demonstrates that restitution has been awarded to the claimant
as described in section 16 of this chapter.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-10
Confidentiality of claimant's personal information
Sec. 10. A claimant's personal information (as defined in
IC 9-14-3.5-5) is confidential.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-11
Persons eligible for restitution assistance
Sec. 11. Except as otherwise provided in this chapter, the
following persons are eligible for restitution assistance under this
chapter:
(1) A resident of Indiana who is a victim of a securities
violation committed:
(A) in Indiana; or
(B) in a jurisdiction other than Indiana, including a foreign
country, if the jurisdiction in which the securities violation
occurred does not offer to Indiana residents who are victims
of securities violations in that jurisdiction assistance that is
substantially similar to the assistance offered under this
chapter.
(2) A nonresident of Indiana who is a victim of a securities
violation committed in Indiana if the jurisdiction in which the
victim resides offers to Indiana residents who are victims of
securities violations in that jurisdiction assistance that is
substantially similar to the assistance offered under this chapter.
(3) A surviving spouse or dependent child of a victim described
in subdivision (1) or (2).
(4) Any other person legally dependent for principal support
upon a victim described in subdivision (1) or (2).
As added by P.L.114-2010, SEC.12.
IC 23-20-1-12
Application for restitution assistance; filing with division
Sec. 12. (a) A person eligible for restitution assistance under
section 11 of this chapter may file an application for restitution
assistance with the division.
(b) The application must be received by the division not more
than one hundred eighty (180) days after the date of the order
described in section 16 of this chapter. The division may grant an
extension of time for good cause shown by the claimant. However,
the division may not accept an application that is received more than
two (2) years after the date of the order described in section 16 of
this chapter.
(c) The application must be filed in the office of the division in
person, through the division's Internet web site, or by first class or
certified mail. If requested, the division shall assist a claimant in
preparing the application.
(d) The division shall accept all applications filed in compliance
with this chapter. Upon receipt of a complete application, the
division shall promptly begin processing the application.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-13
Division's review of applications; request for additional
information
Sec. 13. (a) The division shall review all applications to ensure
that the applications are complete.
(b) If an application is not complete, the application shall be
returned to the claimant with a brief statement of the additional
information required.
(c) The claimant may, not more than thirty (30) days after receipt
of the request for additional information, either supply the
information or appeal to the securities commissioner as to the
completeness of the application.
(d) The decision of the securities commissioner as to the
completeness of the application is final.
(e) The division shall deny the application if:
(1) the applicant does not furnish additional information; or
(2) additional time is not granted by the securities commissioner
for good cause.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-14
Denial of assistance to victim participating in or profiting from
securities violation
Sec. 14. (a) Subject to subsection (b), the division may not award
restitution assistance if the victim:
(1) sustained the monetary injury as a result of:
(A) participating or assisting in; or
(B) attempting to commit or committing;
a securities violation; or
(2) profited or would have profited from the securities violation.
(b) If the victim is a dependent child or dependent parent of the
person who commits a securities violation, restitution assistance may
be awarded if justice requires.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-15
Assistance limited to one claimant per victim
Sec. 15. The division may not award restitution assistance under
this chapter to more than one (1) claimant per victim.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-16
Adjudication of violation required; final order; failure of party to
pay
Sec. 16. (a) The division may not award restitution assistance
under this chapter unless the securities violation was adjudicated in
a state or federal court or a regulatory agency administrative
proceeding.
(b) The division may not award restitution assistance under this
chapter unless:
(1) a final order has been entered ordering restitution to the
victim in a proceeding described in subsection (a); and
(2) the party ordered to pay restitution has not paid the full
amount.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-17
Denial of assistance; order not containing restitution award
Sec. 17. The division shall deny an award of restitution assistance
under this chapter if a court or administrative order does not contain
an award of restitution to the victim.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-18
Restitution award overturned on appeal; denial or forfeiture of
assistance
Sec. 18. (a) The division may not award restitution assistance
under this chapter on behalf of a victim whose award of restitution
under a court or administrative order is overturned on appeal.
(b) If:
(1) restitution assistance is awarded under this chapter; and
(2) after the award of restitution assistance under this chapter,
the victim's award of restitution under a court or administrative
order is overturned on appeal;
the claimant shall forfeit the restitution assistance received under this
chapter.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-19
Subrogation rights of state
Sec. 19. (a) The state is subrogated to the rights of the person
awarded restitution under this chapter to the extent of the award.
(b) The subrogation rights are against the person who committed
the securities violation or a person liable for the pecuniary loss.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-20
State's lien on victim's recovery; deduction of state's share of court
expenses
Sec. 20. (a) In addition to the subrogation rights under section 19
of this chapter, the state is entitled to a lien in the amount of the
award on a recovery made by or on behalf of the victim.
(b) The state may:
(1) recover the amount under subsection (a) in a separate action;
or
(2) intervene in an action brought by or on behalf of the victim.
(c) If a claimant brings an action described in subsection (b)(2),
the claimant may deduct from the money owed to the state under the
lien the state's pro rata share of the reasonable expenses for the court
suit, including attorney's fees. The amount the claimant deducts
under this subsection for the state's pro rata share of the expenses
may not be more than fifteen percent (15%) of the money owed
under the lien.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-21
Recovery by claimant receiving assistance; refund to state of
overpayment
Sec. 21. If:
(1) an award is made under this chapter; and
(2) a claimant receives a sum required to be deducted under
section 20(a) of this chapter;
the claimant shall refund to the state the amount of overpayment.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-22
Victim's contribution to monetary injury; consideration in amount
of assistance; basis for denial
Sec. 22. (a) In determining the amount of restitution assistance to
award under this chapter, the division shall determine whether a
victim contributed to the infliction of the victim's monetary injury.
(b) If the division finds that the victim contributed to the infliction
of the victim's monetary injury, the division may deny an award of
restitution assistance.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-23
Limitations on award
Sec. 23. An award under this chapter may not exceed the lesser of
the following:
(1) Fifteen thousand dollars ($15,000).
(2) Twenty-five percent (25%) of the amount of the
out-of-pocket loss.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-24
Award not subject to execution, attachment, or garnishment
Sec. 24. An award made by the division under this chapter is not
subject to execution, attachment, garnishment, or other process.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-25
Securities restitution fund; establishment; funding sources
Sec. 25. (a) The securities restitution fund is established.
(b) The fund consists of amounts:
(1) from funds received for deposit in the securities division
enforcement account as provided in IC 23-19-6-1(f); and
(2) appropriated from the general assembly.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-26
Securities restitution fund; funds continually appropriated;
purposes
Sec. 26. The money in the fund is continually appropriated to the
division for purposes of:
(1) awarding restitution assistance under this chapter; and
(2) paying expenses incurred in administering this chapter.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-27
Securities restitution fund; funds and income nonreverting
Sec. 27. Money in the fund and income derived from money in the
fund do not revert to the state general fund at the end of a state fiscal
year.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-28
Securities restitution fund; threshold; suspension of payment of
claims; proration of claims after suspension period
Sec. 28. (a) If the fund would be reduced below two hundred fifty
thousand dollars ($250,000) by payment in full of all awards that
become final in a month, the division shall suspend payment of the
claims that become final during the month and the following two (2)
months.
(b) At the end of the suspension period, the division shall pay the
suspended claims. If the fund would be exhausted by payment in full
of the suspended claims, the amount paid to each claimant shall be
prorated.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-29
State's liability for award; limited to availability of money in fund
Sec. 29. The state is not liable for a written determination made
by the division under this chapter except to the extent that money is
available in the fund on the date the award is computed by the
division under this chapter.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-30
Claimant convicted of forgery, fraud, or deception; forfeiture of
award; civil action by division to recover funds
Sec. 30. (a) A claimant convicted of forgery, fraud, or deception
in connection with a claim under this chapter forfeits an award paid
to the claimant under this chapter.
(b) The division may file a civil action to recover funds against a
claimant described in subsection (a).
As added by P.L.114-2010, SEC.12.
IC 23-20-1-31
False or misleading statements; Class C felony
Sec. 31. A person commits a Class C felony if the person
knowingly makes or causes to be made:
(1) in any document filed with or sent to the securities
commissioner or the division; or
(2) in any proceeding, investigation, or examination;
under this chapter any statement that is, at the time and in the light
of the circumstances under which it is made, false or misleading in
any material respect.
As added by P.L.114-2010, SEC.12.
IC 23-20-1-32
Division's authority to adopt rules
Sec. 32. The division may adopt rules under IC 4-22-2 to
implement this chapter.
As added by P.L.114-2010, SEC.12.