Marcia Hultman

Cabinet Secretary

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Division of Insurance - Securities Regulation

Enforcement and Investor Complaints

The Division of Insurance - Securities Regulation is responsible for regulating securities, franchise and business opportunity offerings for the state of South Dakota. The Division oversees the firms and individuals who offer and sell securities or offer investment advice to the public, franchises and business opportunities.

File a Complaint

What We Can Do When There Is a Complaint

What We Cannot Do

How You Can Help Us

Investigate Before You Invest

What We Can Do When There Is a Complaint

The Division can investigate complaints against individuals, business firms and other entities for possible violations of the three statutes the Division administers. We are empowered to bring administrative actions to stop these violations, render sanctions and, in appropriate cases, refer matters for criminal prosecution. It is in the public interest to report alleged violations, and we encourage all investors to do so.

What We Cannot Do

The Division cannot act as a court of law. We cannot order that your investment be returned or that the violator pay damages to you. In some instances restitution is made to investors as a result of the Division's investigation or action, but, do not rely on the division to get your money back for you.

We cannot give legal or financial advice or act as your attorney.

How You Can Help Us

Organizing Your Complaint

Make a list of the things you want to say. Separate feelings from fact.
Present the events in the order in which they happened, using dates whenever possible:

Tell us what happened. Start from the beginning and be specific.
Tell us how you first learned of the investment opportunity or service.
Tell us who was present during the conversations or acts.
Tell us when and where these conversations/acts took place.
Tell us when and where the money changed hands and agreements were signed.
Tell us why you decided to take advantage of the investment or investment service.
List the names, addresses and telephone numbers of others you believe may have similar complaints.

Type or print the information as clearly as possible. You may submit an initial complaint to the Division of Insurance - Securities Regulation, by letter, facsimile, telephone or email using our contact information.
Enclose copies of any and all documents related to your complaint, such as stock certificates, bonds, limited partnership agreements, prospectuses, confirmations, account statements, letters, canceled checks (front and back), advertisements, papers, notes or other documents that may explain your complaint. If you must send originals, please indicate that in your cover letter. We will immediately copy the originals and return them to you. However, if you send originals, we cannot guarantee their safekeeping.
Many complaints involve licensed broker-dealer firms and their agents. Some can be directly resolved by:

Notifying Your Broker and Your Broker's Manager

Talk to your salesperson about the problem.
Negotiate directly with your salesperson to resolve the matter. Frequently, minor issues can be settled informally at this point.
If you feel the salesperson has answered your questions unsatisfactorily or is unwilling to review your complaint, contact the salesperson’s supervisor and the office manager.
Write to the firm’s chief compliance officer. This individual is located at the firm’s home office address. Request a response in writing from the compliance officer.
If you do not get a response or receive an unsatisfactory response, please report the problem to us.

Investigate Before You Invest

Choosing a Stock Broker or Investment Adviser/Planner

If you have money to invest, decide if you can afford to lose it.

Do not invest your money in securities if you cannot afford to lose it. Unlike bank certificates of deposit or passbook savings, a securities investment is not secured, guaranteed or protected by government insurance. While some securities investments are less risky than others, none are safe.
Always use licensed brokers and adviser/planners.

Check to see if the individual is properly licensed with the state of South Dakota before you invest. The Division can provide you with the individual's track record so you can make an informed decision. No broker should pressure you to make an investment. Never allow someone to make a high pressure sale to you over the telephone. If it sounds too good to be true, it probably is.
Use the Financial Industry Regulatory Authority's Broker Check to verify broker or dealer licensing.
Use the U.S. Securities and Exchange Commission's Investment Adviser Search to verify the validity of an investment adviser.
Define your investment objective. Make sure the broker or adviser/planner reviews your investment objectives with you, writes those objectives down, and periodically updates and reviews these objectives with you. You will be required to fill out a new account form. Make sure you review it before signing it.
Get all the information you need. Make sure you feel comfortable with your broker or adviser/planner. No question is "dumb." It is your money and your financial future. The broker or adviser/planner may ask you questions about your net worth and financial background. Be sure to be honest about all information.
It is your money. Do not let a broker or adviser/planner pressure you, embarrass you or convince you to invest in something you do not want or have time to investigate. While you need to have a trusting relationship, remember: this is your money, and the broker or adviser/planner should want to make money for you both.
Know your account. Make sure the broker or adviser/planner pays attention and acts on your requests. For example, if a broker fails to execute a trade or fails to provide you with a prospectus or other report you have requested, on a timely basis, you should complain. Review your account statement every month and report discrepancies immediately to the broker or adviser/planner and that individual's supervisor as soon as possible. Make sure you are satisfied with the explanation. Keep a copy of all your records.
If something goes wrong, refer to, Organizing Your Complaint.

If you have questions, please Contact Us.