Massachusetts, New Hampshire and Texas are holding elections next week. Find out what's on your ballot in our latest report.

Difference between revisions of "South Dakota Securities Practices and Transactions, Initiative 9 (2008)"

From Ballotpedia
Jump to: navigation, search
(added templates, edited intro, elections results, text of measure, see also, ext links and categories)
Line 1: Line 1:
{{TOCnestright}}The '''South Dakota Small Investors Protection Act, Initiated Measure 9''' was a citizen [[initiated constitutional amendment]] that appeared on the November 4, 2008 general election ballot in [[South Dakota]].
+
<table style="float: right;">
 +
<tr valign="top">
 +
<td>
 +
{{tnr}}
 +
</td>
 +
<td>
 +
{{Business regulation}}
 +
{{SDConstitution}}
 +
</td>
 +
</tr>
 +
</table>
 +
 
 +
The '''South Dakota Securities Practices and Transactions Initiative''', also known as '''Initiative 9''', was on the [[2008 ballot measures#South Dakota|November 4, 2008 ballot]] in [[South Dakota]] as an {{issfull}}, where it was '''defeated'''. The measure would have prohibited short sale of stock and limited the amount of time to deliver sold securities to three business days.<ref>[https://web.archive.org/web/20140516220654/http://sdsos.gov/elections-voting/assets/BallotQuestions1890-2010.pdf ''South Dakota Political Almanac,'' "South Dakota Constitutional Amendments, Initiatives and Referendums 1970-2010," accessed August 27, 2014]</ref><ref>[https://sdsos.gov/elections-voting/election-resources/election-history/election-history-search.aspx ''South Dakota Secretary of State'',  "Historical Election Data," accessed August 27, 2014]</ref>
  
 
==Election results==
 
==Election results==
Line 5: Line 17:
 
''See also [[2008 ballot measure election results]]''
 
''See also [[2008 ballot measure election results]]''
  
These results are based on the Elections Division of South Dakota.<ref>[http://electionresults.sd.gov/applications/st25cers3/resultsSW.aspx?type=bq South Dakota Elections Division, 2008 Election Results]</ref>
 
 
{{Short outcome
 
{{Short outcome
 
| title = South Dakota Measure 9 (2008)
 
| title = South Dakota Measure 9 (2008)
| yes = 146,831
+
| yes = 146,872
| yespct = 43.4
+
| yespct = 43.39
| no = 191,549
+
| no = 191,596
| nopct = 56.6
+
| nopct = 56.61
| total = 338,380}}
+
}}
 +
Election results via: [https://web.archive.org/web/20140516220654/http://sdsos.gov/elections-voting/assets/BallotQuestions1890-2010.pdf South Dakota Political Almanac, South Dakota Constitutional Amendments, Initiatives and Referendums 1970-2010]
 +
 
 +
==Text of measure==
 +
The text of the measure can be read [https://sdsos.gov/elections-voting/election-resources/election-history/2008/2008_general_information_ballot_question_attorney_general_explanations_full_text.aspx here].
  
 
==Background==
 
==Background==
 
 
 
Article 4 of South Dakota's Uniform Securities Act of 2002 concerns the state registration requirements and exemptions from them for broker-dealers, agents, investment advisors, investment advisor representatives, and federal covered investment advisors.<ref>[http://legis.state.sd.us/statutes/DisplayStatute.aspx?Type=Statute&Statute=47-31B ''Uniform Securites Act of 2002'']</ref>
 
Article 4 of South Dakota's Uniform Securities Act of 2002 concerns the state registration requirements and exemptions from them for broker-dealers, agents, investment advisors, investment advisor representatives, and federal covered investment advisors.<ref>[http://legis.state.sd.us/statutes/DisplayStatute.aspx?Type=Statute&Statute=47-31B ''Uniform Securites Act of 2002'']</ref>
  
 
This initiative aimed to amend two specific subsections to make broker-dealers, agents, investment advisors, investment advisor representatives, and federal covered investment advisors liable for up to $10,000 in damages for each violation for commercially unreasonable delay in delivery of securities that they have sold; commercially unreasonable delay being defined for the purpose of this law as more than 3 business days.<ref>[http://www.sdsos.gov/electionsvoteregistration/electvoterpdfs/2008/2008InMeasUniformedSecuritiesAct.pdf ''Initiative Petition'']</ref> The purpose of this is to prohibit short-selling of securities.
 
This initiative aimed to amend two specific subsections to make broker-dealers, agents, investment advisors, investment advisor representatives, and federal covered investment advisors liable for up to $10,000 in damages for each violation for commercially unreasonable delay in delivery of securities that they have sold; commercially unreasonable delay being defined for the purpose of this law as more than 3 business days.<ref>[http://www.sdsos.gov/electionsvoteregistration/electvoterpdfs/2008/2008InMeasUniformedSecuritiesAct.pdf ''Initiative Petition'']</ref> The purpose of this is to prohibit short-selling of securities.
 
'''Attorney General's Explanation:'''
 
 
"State and federal law regulates the purchase and sale of stocks and other securities.
 
 
A common "stock market" transaction is a "short sale" where, for example, an investor who believes a publicly traded stock is over-priced will borrow that stock from an owner, sell the borrowed stock, and repurchase the stock later at a lower price to repay the loan, thereby making money if the price has fallen. If the price goes up, the investor must repurchase the stock at the higher price to repay the loan, and will lose money. Measure 9 would prohibit short sales.
 
 
State law currently does not regulate the time frame for the delivery of securities upon sale. Measure 9 would prohibit anyone from routinely taking longer than three business days to deliver securities they have sold.
 
 
If it had been adopted, Measure 9 would likely have been challenged in court and may have been declared to be preempted by federal law and the United States Constitution."<ref>[http://www.sdsos.gov/electionsvoteregistration/electvoterpdfs/2008SouthDakotaBallotQuestionPamphlet.pdf '''Attorney General's Explanation'']</ref>
 
  
 
==Support==
 
==Support==
Line 41: Line 44:
 
Mark V. Meierhenry of [http://www.meierhenrylaw.com/ Danforth & Meierhenry] and Tim Mooney of [http://www.apcusa.com/ Arno Political Consultants] wrote the "pro" arguments for the state Ballot Question Pamphlet:  
 
Mark V. Meierhenry of [http://www.meierhenrylaw.com/ Danforth & Meierhenry] and Tim Mooney of [http://www.apcusa.com/ Arno Political Consultants] wrote the "pro" arguments for the state Ballot Question Pamphlet:  
 
* Currently, if someone in South Dakota is harmed by short selling, they have to go to the place of the sale to seek restitution. This measure would mean that a lawsuit could be pursued in South Dakota.
 
* Currently, if someone in South Dakota is harmed by short selling, they have to go to the place of the sale to seek restitution. This measure would mean that a lawsuit could be pursued in South Dakota.
* The measure does not outlaw short selling, it merely enables federal law regarding short sales to be prosecuted in South Dakota.<ref>[http://www.sdsos.gov/electionsvoteregistration/electvoterpdfs/2008SouthDakotaBallotQuestionPamphlet.pdf ''2008 South Dakota Ballot Question pamphlet''] Pro - Initiated Measure 9</ref><ref>[http://www.keloland.com/NewsDetail6162.cfm?ID=0,74176 ''Money Matters: Short Selling Issue''], Keloland, September 28, 2008</ref>
+
* The measure does not outlaw short selling, it merely enables federal law regarding short sales to be prosecuted in South Dakota.<ref name=sos>[https://sdsos.gov/elections-voting/assets/2008SouthDakotaBallotQuestionPamphlet.pdf ''South Dakota Secretary of State'', "2008 South Dakota Ballot Question pamphlet," accessed August 27, 2014]</ref><ref>[http://www.keloland.com/NewsDetail6162.cfm?ID=0,74176 ''Money Matters: Short Selling Issue''], Keloland, September 28, 2008</ref>
  
 
==Opposition==
 
==Opposition==
Line 51: Line 54:
  
 
===Arguments Against===
 
===Arguments Against===
Gail Sheppick Director of the [http://www.state.sd.us/drr2/reg/securities/ South Dakota Division of Securities] wrote the "con" arguments for the state Ballot Question Pamphlet:
+
Gail Sheppick, Director of the [http://www.state.sd.us/drr2/reg/securities/ South Dakota Division of Securities] wrote the "con" arguments for the state Ballot Question Pamphlet:
 
* The measure is too broad, attempting to regulate legal short sales outside of the state.
 
* The measure is too broad, attempting to regulate legal short sales outside of the state.
 
* Current federal and South Dakota law already prohibits the abuse of short sales.
 
* Current federal and South Dakota law already prohibits the abuse of short sales.
* Brokerage firms might take their business out of the state should this measure pass.<ref>[http://www.sdsos.gov/electionsvoteregistration/electvoterpdfs/2008SouthDakotaBallotQuestionPamphlet.pdf ''2008 South Dakota Ballot Question pamphlet''] Con - Initiated Measure 9</ref><ref>[http://www.keloland.com/NewsDetail6162.cfm?ID=0,74176 ''Money Matters: Short Selling Issue''], Keloland, September 28, 2008</ref>
+
* Brokerage firms might take their business out of the state should this measure pass.<ref name=sos/><ref>[http://www.keloland.com/NewsDetail6162.cfm?ID=0,74176 ''Money Matters: Short Selling Issue''], Keloland, September 28, 2008</ref>
 
* Initiated Measure 9 aims to prohibit the practice of “short selling” in the financial securities trade. Short sellers “sell high” with the intention of “buying back low.” The Securities and Exchange Commission, which sets rules and regulations for financial markets, has traditionally allowed this type of trading activity. It is not clear that Measure 9 would stand up to legal scrutiny if passed.
 
* Initiated Measure 9 aims to prohibit the practice of “short selling” in the financial securities trade. Short sellers “sell high” with the intention of “buying back low.” The Securities and Exchange Commission, which sets rules and regulations for financial markets, has traditionally allowed this type of trading activity. It is not clear that Measure 9 would stand up to legal scrutiny if passed.
  
Line 61: Line 64:
 
* [[South Dakota 2008 ballot measures]]
 
* [[South Dakota 2008 ballot measures]]
 
* [[2008 ballot measures]]
 
* [[2008 ballot measures]]
 +
* [[List of South Dakota ballot measures]]
 +
* [[History of Initiative & Referendum in South Dakota]]
  
 
==External links==
 
==External links==
*[http://www.sdsos.gov/electionsvoteregistration/electvoterpdfs/2008/2008InMeasUniformedSecuritiesAct.pdf Full text of petition] (PDF file)
+
* [https://web.archive.org/web/20140516220654/http://sdsos.gov/elections-voting/assets/BallotQuestions1890-2010.pdf ''South Dakota Political Almanac,'' South Dakota Constitutional Amendments, Initiatives and Referendums 1970-2010]
*[http://www.sdsos.gov/electionsvoteregistration/upcomingelection_ballotquestionstatus.shtm South Dakota SOS Ballot Question Status]
+
* [https://sdsos.gov/elections-voting/election-resources/election-history/2008/2008_general_information_ballot_question_attorney_general_explanations_full_text.aspx South Dakota Secretary of State: 2008 Ballot Question Text]
* [http://www.sdsos.gov/electionsvoteregistration/electvoterpdfs/2008SouthDakotaBallotQuestionPamphlet.pdf 2008 South Dakota Ballot Questions Pamphlet]
+
* [http://www.voteyes9.com/ Vote Yes on 9] supporters website
+
 
+
==References==
+
{{reflist}}
+
  
 
==Additional reading==
 
==Additional reading==
Line 76: Line 76:
 
* [http://www.aberdeennews.com/apps/pbcs.dll/article?AID=/20080503/UNKNOWN/805030362/-1/opinion04 ''S.D. has no 'right to inspect' law'']
 
* [http://www.aberdeennews.com/apps/pbcs.dll/article?AID=/20080503/UNKNOWN/805030362/-1/opinion04 ''S.D. has no 'right to inspect' law'']
 
* [http://www.zwire.com/site/news.cfm?newsid=20145426&BRD=1971&PAG=461&dept_id=175429&rfi=6 ''Voters Will Decide Seven Issues''], Marshall County Journal, October 1, 2008
 
* [http://www.zwire.com/site/news.cfm?newsid=20145426&BRD=1971&PAG=461&dept_id=175429&rfi=6 ''Voters Will Decide Seven Issues''], Marshall County Journal, October 1, 2008
 +
 +
==References==
 +
{{reflist}}
 +
 
{{2008 ballot measures}}
 
{{2008 ballot measures}}
 
{{South Dakota}}
 
{{South Dakota}}
 +
{{hbm text|August 2014}}
  
 
[[Category:South Dakota 2008 ballot measures]]
 
[[Category:South Dakota 2008 ballot measures]]
Line 83: Line 88:
 
[[Category:Business regulation, 2008]]
 
[[Category:Business regulation, 2008]]
 
[[Category:Defeated, 2008]]
 
[[Category:Defeated, 2008]]
 +
[[Category:Historical ballots, 2014]]

Revision as of 17:43, 27 August 2014

Voting on
Business Regulation
Business regulation.jpg
Ballot Measures
By state
By year
Not on ballot
South Dakota Constitution
Seal of South Dakota.jpg
Articles
IIIIIIIVVVIVIIVIIIIXXXIXIIXIIIXIVXVXVIXVIIXVIIIXIXXXXXIXXIIXXIIIXXIVXXVXXVIXXVIIXXVIIIXXIX

The South Dakota Securities Practices and Transactions Initiative, also known as Initiative 9, was on the November 4, 2008 ballot in South Dakota as an initiated state statute, where it was defeated. The measure would have prohibited short sale of stock and limited the amount of time to deliver sold securities to three business days.[1][2]

Election results

See also 2008 ballot measure election results

South Dakota Measure 9 (2008)
ResultVotesPercentage
Defeatedd No191,59656.61%
Yes 146,872 43.39%

Election results via: South Dakota Political Almanac, South Dakota Constitutional Amendments, Initiatives and Referendums 1970-2010

Text of measure

The text of the measure can be read here.

Background

Article 4 of South Dakota's Uniform Securities Act of 2002 concerns the state registration requirements and exemptions from them for broker-dealers, agents, investment advisors, investment advisor representatives, and federal covered investment advisors.[3]

This initiative aimed to amend two specific subsections to make broker-dealers, agents, investment advisors, investment advisor representatives, and federal covered investment advisors liable for up to $10,000 in damages for each violation for commercially unreasonable delay in delivery of securities that they have sold; commercially unreasonable delay being defined for the purpose of this law as more than 3 business days.[4] The purpose of this is to prohibit short-selling of securities.

Support

Measure 9 was authored by former South Dakota Attorney General Mark Meierhenry.

This initiative was supported by South Dakotans for Securities Reform, chaired by State Representative Hal Wick (R-Sioux Falls).

"South Dakotans for Securities Reform consists of stockholders and concerned citizens who want to help protect South Dakota companies, stockholders and taxpayers from the harms of stock manipulation through naked short selling and failure-to-delivers."[5]

Arguments For

Mark V. Meierhenry of Danforth & Meierhenry and Tim Mooney of Arno Political Consultants wrote the "pro" arguments for the state Ballot Question Pamphlet:

  • Currently, if someone in South Dakota is harmed by short selling, they have to go to the place of the sale to seek restitution. This measure would mean that a lawsuit could be pursued in South Dakota.
  • The measure does not outlaw short selling, it merely enables federal law regarding short sales to be prosecuted in South Dakota.[6][7]

Opposition

This ballot measure was opposed by Governor Mike Rounds. "In a July letter to the industry association, South Dakota Gov. Mike Rounds said promoters might have good intentions, but the proposed initiative would unduly burden and obstruct interstate commerce."[8]

Travis Larson, spokesman for the Securities Industry and Financial Markets Association, was quoted as saying: "The SEC has been given control of our financial market regulations so that we have one single set of rules and regulations for our financial markets," Larson said. "And if every state were to pass its own rules _ some of which may run counter to the SEC _ the patchwork quilt of resulting rules and regulations would tie up our financial markets and slow them, hurting our competitiveness."[9]

The State Bar Association, South Dakota Chamber of Commerce and the Board of Directors for the South Dakota retirement system were all opposed to the measure.[10][11]

Arguments Against

Gail Sheppick, Director of the South Dakota Division of Securities wrote the "con" arguments for the state Ballot Question Pamphlet:

  • The measure is too broad, attempting to regulate legal short sales outside of the state.
  • Current federal and South Dakota law already prohibits the abuse of short sales.
  • Brokerage firms might take their business out of the state should this measure pass.[6][12]
  • Initiated Measure 9 aims to prohibit the practice of “short selling” in the financial securities trade. Short sellers “sell high” with the intention of “buying back low.” The Securities and Exchange Commission, which sets rules and regulations for financial markets, has traditionally allowed this type of trading activity. It is not clear that Measure 9 would stand up to legal scrutiny if passed.

See also

BP-Initials-UPDATED.png
Suggest a link

External links

Additional reading

References


BallotMeasureFinal badge.png
This historical ballot measure article requires that the text of the measure be added to the page.