• Created SEC
• Gives SROS rulemaking authority but are under SEC
• Requires issuers, exchanges and B/Ds to register with SEC

• An insider is defined as a company officer, director or any owner of 10% of more of company's equity.
• Ownership of 10% or more must be reported within 10 days 
• Trades by insiders must be reported within 2 business days. 
• Can have a criminal penalty of up to $5 million and 20 years in prison or 3 times the damage (treble damages)

• Face amount certificates
• Unit investment Trusts
• Management Companies (open or Mutual, closed)
• Rules and Regulations - Companies with more than 100 shareholders must register with the SEC and have a min net worth of $100,000 before offering to the public.  
• Majority vote is needed to change fund objectives.

• Flow-through of tax treatment.
• Unlimited personal liability.

• Most traditional form of corporation.
• Unlimited number of shareholders with limited liability and can raise unlimited amount of capital.
• Double Taxation!!! Subject to regular corporation taxes + taxation of distributed dividends.
• Files form 1120

• Flow-through entity or Conduit
• It is not taxable itself.
• Limited to no more than 100 shareholders.
• The income and the losses of the corporation flows through to the partners, but shareholders still have limited liability.

• Flow-through of profits with no double taxation.
• Created by two or more people to create a business.
• General partners have unlimited liability.
• Limited partners have a limited liability and their income/losses are passive income. 
• K-1 is the form used to report distributed income. 
• Risks include illiquidity, regulatory, future assessment. 
• Most are exempt from registration under regulation D - private placements. 

• No limited partners.
• Each partner has personal liability and may manage the business. 
• Flow-through of tax treatment.

• Combines the pass through of a partnership with the limited liability of a corporation. 
• Can have more than 100 shareholders.
• Easier to setup, more flexibility than an S-Corp.

• Total assets and liabilities of a deceased person. 
• Probate is the court process by which the assets and liabilities of a deceased person will be distributed based on their will. 
• When someone dies the estate will go through probate and liabilities will be paid off before assets go to their heirs. 
• Executor is assigned by will and conservator is named by court if not mentioned in will (they do the same thing).

• Its own legal entity where an individual (creator) gives fiduciary control of the property to a person or institution (trustee) for the benefit of the beneficiary. 
• The trust is the taxable entity, not the the beneficiary. (Form 1041)

• Doesn't reduce estate taxes. 
• Avoids probate if funded prior to donor's death.
• Setup by the grantor and can be altered or revoke provisions of the trust while they are alive.
• Income is distributed to the grantor and will transfer upon death.  
• Doesn't shield them from the estate tax.  

• Beneficiary has ultimate control and grantor has given up complete control of property. 
• Will reduce estate taxes and avoid probate.
• Removes property from the Grantor's estate.  

• Never reccommend that all discretionary $ be put in the stock market.  
• Total Monthly income - Total monthy expenditures
• Monthly income (salary, investment income, other income)
• Monthly expenses (taxes, mortgage payments, car payments.)

Types of Taxable income

(Earned & Unearned)

• Earned - income, tips, commissions, self-employement.
• Unearned income - interest, dividend, alimony, retirement plan, annuity, SS payments. (Doesn't include child support).

• Only realized at the SALE or redemption of an asset.
• Short-term are at ordinary income rates.
• Long-term are at maximum 20%

• If losses outweigh gains the you can use up to $3,000 to deduct against ordinary income each year. 
• Remaining losses are carried forward. 

• A method of calculating tax liability to ensure that ewalthy tax payers pay a specificied minimum amount. 
• It may apply to certain municipal revenue bonds and activities related to limited partnerships. 

• Cash Account - Purchases must be paid in full by settlement date.
• Margin Account- Investors are allowed to buy securities by only paying for a portion of the total and then borrowing the rest from a B/D.  The B/D holds the securities as collateral.  Margin limits set by FRB!!!
• Discretionary Account

Account Documents 

(Durable POA, Stock Power, 3rd party trading authorization, Certificate of Incumbency)

• Durable Power of Attorney - Allows a person to act on behalf of another person even if the person becomes disabled. Doesn't last if person dies.
• Stock Power - POA allowing a person to transfer stock ownership to another person.
• Third Party Trading Authorization - Required to permit a person other than the RR to execute trades on behalf of an account owner.
• Certificate of incumbency - Issued by a court to appoint a guardian to act on behalf of an incompetent/minor.

• Employee Retirement Income Security Act- imposes a high standard for the following two;
• Parties in interest: Anyone providing services to the plan. They are prohibited from selling property to the plan, loaning any money or using plan assets for their own benefit. 
• Fiduciary: Anyone who provides investment advice, excercises discretion or responsible for the administration of the plan. 

• ERISA 404 (b) - No fiduciary may maintain indicia of ownership of a client's account outside the US. 
• ERISA 404 (c) - Voluntary guidelines for plan sponsors and allow participants to make informed decisions. 

• Must meet ERISA standards
• Contributions are tax-deductible
• Earnings are tax-deferred
• Distributions are taxed as ordinary income. 
• Main Types; Pension plans, profit-sharing, 401k, 403b, 457, SEP-IRA

• Not required to meet ERISA standards.
• Contributions are not tax deductible.
• Earnings grow tax-deferred.
• Only earnings are taxed as ordinary income.  
• Main Types: Payroll deductions, deferred compensation plans. 

• Max Contribution is $17,500
• For-profit Employees
• Pre-tax (deductible) 
• $0 cost basis

• Max Contribution is $17,500
• Non-profit Employees
• Pre-tax (deductible) 
• $0 cost basis

• Max Contribution is $17,500
• For State or Local Government employees
• Pre-tax (deductible) 
• $0 cost basis

• Max Contribution is 25% of income or $51,000
• Self-Employed Persons
• Pre-tax (deductible) 
• $0 cost basis

• Inherited from Spouse you have three options;                1. Take Lump-Sum Withdrawal 2. Rollover into your own IRA 3. Open an inherited IRA where w/drawals begin on Dec 31st of spouses death; or if not 70.5 years old, by Dec 31st of when they would have been 70.5
• Inherited from non-spouse, two options;                       1. Take lump-sum withdrawal 2. Open inherited IRA and can either take distributions for rest of life or clear account within 5 years of deceased turing 70.5.

• Max Contribution is $2,000/year until child's 18th birthday
• After-tax contributions (non-deductible)
• Tax-free if used for educational expenses and before 30.
• Anyone can open up to certain income limit.

• Contribution is determined by state (5x $14,000), but much higher than coverdell
• Anyone can contribute
• After-tax (no deduction)
• Tax-free if used for education (secondary only; no private highschool)

Traditional Whole Life

(Death Benefit, Cash Value, Loans, Premiums, Investment Account, Party at Risk)

• Death Benefit: Fixed value
• Cash Value: Guaranteed
• Loans: Allowed against current cash value (up to 90%)
• Premium Payments: Fixed amount at fixed intervals
• Investment Account: General account
• Risk: Insurance Company

Universal Life

(Death Benefit, Cash Value, Loans, Premiums, Investment Account, Party at Risk)

• Death Benefit: Variable
• Cash Value: Guaranteed minimum value
• Loans: Allowed against current cash value
• Premium Payments: Flexible in amount and timing
• Investment Account: General Account
• Risk: Insurance company

Variable Life

(Death Benefit, Cash Value, Loans, Premiums, Investment Account, Party at Risk)

• Death Benefit: Preset Minimum amount
• Cash Value: No guarantee
• Loans: Allowed up to 75% of cash value
• Premium Payments: fixed amounts at fixed intervals
• Investment Account: Seperate account that meet's investor's needs
• Risk: Policyholder (considered a security)

• Immediate - Pay lump sum with an immediate payout
• Deferred - Pay lump sum or periodic with a deferred pay out date
• Can be either qualifed or non-qualified defined by ERISA.
• Earnings grow tax deferred!!!

Fixed Annuity

(It is a poor hedge against...)

• Not a security
• Insurance company assumes risk
• Goes into a general account
• Guaranteed stream of income, but is a poor hedge against inflation.

• It is a security
• Annuitant assumes risk
• Goes into Seperate Account
• It is a good hedge against inflation, but the payout varies based on seperate account performance. 

• Offers a guaranteed minimum return, but like a variable annuity, has a variable return (based on index return)
• Participation rate - If participation rate is 80% and index goes up 10% then you will get 8% credited to your annuity.
• Cap Rate - Using the same example if a company has a 7% cap rate then you will get 7%, not 8%.
• Not suitable for short term investment (generally true of deferred annuities).

• Sold under private placements
• unregistered investment pools, usually set up as llc or limited parnership. 

• Long Call - Have the right to buy a security at a certain price, considered Bullish strategy.
• Buy a put - Have the right to sell a security at a certain price, considered a Bearish strategy.

• Short Call - Have the obligation to sell a security at a specific price, considered a bearish strategy.
• Sell a Put - Have the obligation to buy a security at a specific price, considered a bullish strategy. 

Buy a Put

Buy a Call

Sell a Call

• American allows you excercise option whenver you want.
• European will only allow at the end of the life of a contract. 
• Capped is when there is a set level built into the contract where it will be excercised. 

• Long-Term Equity AnticPation Securities
• Maturity between 1-3 years. 
• Seller receives a greater premium than typical options because of longer maturities and higher chance of stock increasing. 

Short straddle you are expecting stability

Long straddle you are expecting volatility

• A derivative with standardized quantity and quality.
• Just like options.
• Non-personal
• May be offset which mean you can trade out of the contract because they are managed by clearing houses.

• Made between two parties (normally financial institutions)
• Variable quantity
• OTC - traded with negotiable terms.
• Personal 
• May not be offset or sell off contract. 

Current Assets (subtract inventory for quick ratio)

Current Liabilities

Debt

Equity

Net Income - Preferred Dividend

Common Shares Outstanding

Market Price

Earnings per Share

• Growth stock have high P/E ratio
• Value stock has low P/E ratio

Shares outstanding X Current Market Value (excluding treasury stock)

10-K

Filed with SEC to report events which may affect the corporation or its shareholders (such as bankruptcy or a merger).

• Buy stock that is undervalued.
• Low P/E ratio
• Low Price-to-Book to Value
• Typically pay dividends.

• Buy stock that is in stages of rapid growth.
• High P/E ratio with possibility of no earnings. 
• High Price-to-Book to Value
• Typically DO NOT pay dividends.

Modern Portfolio Theory 

(3 factors)

1. Expected Return - possible return of an asset weighted by it's likelihood (based on historical returns) 
2. Standard Deviation - Views risk as the variability of expected returns; used as a basic measure of risk.  The higher the SD the more volatile the portfolio is.
3. Correlation - Positive, neutral and negative.

• Extension of MPT
• Systematic/Market/Nondiversifiable Risk - Examples include market risk (measured by beta), interest rate risk, inflation risk.
• Unsystematic Risk (diversifiable) - CAn reduce by owning uncorrealated stocks.  Examples include business risk, regulatory risk, political risk, liquidity risk

• Measures systematic risk
• Compares the movement of a stock against he S&P.
• If portfolio has a beta of 1.5 will go up 15% when market is up 10% and be down 15% when market is down 10%.
• Portfolio's with beta lower than 1 underperform the market when it is up and outperform when the market is down.
• Portfolio's with a beta higher than 1 outperform when the market is up and underperform when the market is down. 

Efficient Market Hypothesis

(Weak-form, Semi-strong, Strong-form)

1. Weak-Form Efficiency: Future stock prices cannot be predicited based on past events relating to price and volume. Fundamental analysis (company financials, board, etc.) is more helpful than technical analysis in making investment decisions. 
2. Semi-Strong Efficiency: All publicy available information is already reflected in the stock price so any form of analysis is useless. Only advantage would be to have insider information. Dart board theory.
3. Strong-Form Efficiency: All public and non-public information is reflected in the price of a stock; therefore no one can acheive returns exceeding the market.  Proper asset allocation is best LT approach. Most likely purchase index funds. 

• Discounts the future value to know what the present value needs to be.

• Compounding the PV to get the Future value of an investment. 

• Same things as Yield to Maturity when speaking of bonds. 

• If NPV > 0, it is an attractive investment.
• If NPV < 0, it is an unattractive investment.
• If NPV = 0, it is a neutral investment.

NPV is a method of estimating whether an investment in a project or a security is viable based upon cash flows and an expected rate of return.

Risks that cannot diversify away.

1. Interest Rate - Risk that the value of a bond will decline due to increasing interest rates. 
2. Currency - Risk of loss on a foreign currency exchange. 
3. Market - Risk inherent in all securities due to market inflation. 
4. Reinvestment - Risk that interest rates will fall and semi-annual coupons will be reinvested at a lower rate. 
5. Inflation - Risk that the purchasing power of a bond's fixed interest income may decline over time due to inflation. 

Annual Dividend

Current market price

Annual Interest

Current Market Price

Dividend

Earnings per share

(End Value - Beginning Value) + income paid through HP

Beginning value

Bonds YTM MC

Make a notecard for this. 

Rate of Return - Risk-free return

Risk-free return is the treasury bills.

Tax-Free yield

(100% - Tax Bracket%)

Duration 

(The lower the coupon...)

(The longer the bond's maturity...)

(Duration for zero-coupon bonds equals...)

(For coupon bonds, duration is less than...)

*(the higher the bond's duration, the ___ it's value will change for a 1% change in _____.

• Measures the time in years it takes for a bond to pay for itself. 
• The lower the coupon rate, the greater a bond's duration- the higher the coupon rate, the lower the duration. 
• ...maturity, the greater the bond's duration
• ...equal to it's maturity.
• ...duration is less than the bond's maturity.
• more; interest rates.

Broker-Dealer

Agents

• B/D - Any person in the business of effecting security transactions for the accounts of others or for it's own account. Files Form BD with the CRD.
• Agent - An inividual who represents the B/D in effecting securities transactions.  Files form U4 and files with CRD.  Including: officers, partners, or directors of a B/D. Excluded; Clerical.  

ONLY considered an agent and subject to registration IF; 

• the security being sold is registered (it is not an exempt security or exempt sale).
• the individual receives specific compensation for the sale. 

Investment Adviser

• Provides or determines investment advice.
• Manages accounts
• Solicits advisory services
• Someone who manages an individual doing one of the above mentioned. 
• Files form U4 with IARD.

• An investment of money
• in a common enterprise
• with an expectation of profits
• solely from the efforts of others. 
• NOT a security; commodity, fixed annuity, keogh plan or other retirement plan, endowment, mortgages, collectibles, condos, currency, futures.

• For larger issuers conducting follow-on interstate offerings.
• In business at least 36 months.
• offering price not exceeding $5 per share.
• Not very common today because most companies will file Federally covered securities. 

• Smaller issuers conducting interstate offerings.
• State registration is coordinated with federal registration under the '33 act 
• SEC documents must be filed with the administrator. 
• Amendments are promptly forwarded.
• Effective when the federal registration becomes effective. 

Registration by Qualification

• For issuers conducting intrastate offerings (one state only)
• No federal registration is required
• May be used in any state, for any type of security.
• Effective when determined by the Administrator. 

• It is int he public's best interest AND;
• Filed false or misleading information
• Any officer of issuer was convicted of a securities related crime
• enterprise is illegal
• fees are unpaid
• terms of offering are unfair
• spread earned by syndicate is unreasonable

• U.S. Government Entities ( federal, state, local, foreign)
• Any Canadian security issued by the country, provinces or political subdivision is exempt at the state leve.
• Any country we have a diplomatic relation with.(diplomacy only exists at the national level).
• Banks, S&Ls, trust company, credit union, or insurance company.
• Non-profit Organization
• Company Carrier
• regulated by public utility holding company. 

Exempt Securities

• Short-Term Debt ( 9-month max maturity, and one of 3 highest denominations, and $50k or more).
• Federally covered (listed on national exchange, investment companies, 

• file a consent to service of process.
• pay a filing fee.
• provide the administrator with copies of documents required by SEC.
• Notice filing is not a registration method and cannot be taken away from administrator.
• Only securities listed on NYSE or Nasdaq are exempt from registration and notice filing. 

• Non-Issuer Transaction - secondary market between two investors. Securities subject to '34 act
• Private Placements - limited to no more than 10 non-institutional 
• Institutional transactions - those with banks, B/Ds, or other financial comps. between issuer and underwriter.
• Fiduciary Transactions - involding a trustee, administrator, executor or sheriff.
• Transactions in bonds secured by real estate mortgages (if sold as unit).

• BD has a place of business in the state.
• BD has retail clients in the state (NO de minis exemption applys)

• Exisiting client is visiting another state.
• Exisiting client moves to a new state AND; (1. Agent's registration is pending in new state 2. Agent is registered in at least one other state 3. Agent is registered with a national securities association such as FINRA 4. Agent's B/D is registered in the new state)

• Allows for conduct of business with exisitingn Canadian clients who are temporarily in the U.S. state, provided the B/Ds does not have an office in the state. 

• Investment Adviser Representatives
• Banks, Saving Institutions, trust comps.
• LATE
• B/Ds and their Agents
• Publishers and their periodicals.
• Federally covered adviser (Subject to registration with SEC, subject to notice filing with states and main types are adviser to registered investment companies, $110 mill +, client sin 15+ states. 
• De Minis exemption of 5 non-institutional clients in the state

State Registration of IARs

• In any state in which he has a place of business regardless of whether they are federally covered or not.
• IARs of federally covered adviser's not required to register in that state regardless of the amount of clients in the state (no such thing as an IAR under the fed)

• File Application with CRD or IARD ( Effective on 30th day after filing and expires on Dec 31st with annual renewal after. Amendments for material changes are filed promptly. 
• Filing Fee (Paid Annually, for successor firms - new application must be filed but no additional filing fee needs to be paid)

• For valuing theassets that make up the decedent's estate, the executor has the option of using the date of death value or the "alternate valuation date," which is six months after the date of death unless the property is sold prior to the 6 months. 

• Clients with $1 million in AUM with advisor
• Clients with a net worth of $2 million or more.  Joint accounts must be with a spouse. 

• Maybe required for those who have custody or discretionary authority. 
• Not required if BDs net capital or IAs net worth exceeds minimum set by administrator
• Must be mantained while in business plus three years after. 
• In lieu of bond, cash or securities may be deposited, but no other personal property. 

• Notify administrator in writing
• Appoint a qualified custodian
• notify clients of the name of the custodian and manner in which they are held.
• Send clients Quarterly statements
• If IA sends out statement then a suprise annual audit by a third party accountant must be helf. 
• CPA must report results to Admin on form ADV-E within 30 days. 

If either firms are deficient then they must keep a surety bond and file a report of financial condition. 

B/Ds

• SEC determines the amount by the activities and if B/Ds are deficient they must report within one business day. 

IAs

• The State admin determines the amount (maximum $35k for custodial; $10k for discretion) and must report deficencies within one business day. 

• BDs - 3 years total and first 2 are easily accessible.
• IAs - 5 years and first 2 years at the appropriate office. 

• Expanded the definition of an IA to include sports/entertainment reps, financial planners, Pension Consultant, NRSROs (moody's & Standard and Poors).

1. Banks, Savings Institutions, trust companies (NOT bank holding)
2. LATE
3. BDs and their agents
4. Publishers of newspapers or periodicals (not timed or tailored)
5. IARs
6. Federal covered advisors
7. Any other person designated by the Admin.

1. Banks or Bank holding companies (NOT S&Ls or IA subsidiaries of banks)
2. LATE
3. B/Ds and their representatives
4. Publishers of regular and circular publication materials
5. U.S. Government security advisers
6. Any other person designated by the SEC

• Managing over $100 million in AUM
• Investment advice in over 15 states
• Pension Consultants with at least $200 million 

1. Local Exemption - All clients are residents of state where adviser's office is located, and gives no advice on exchange listed securities. 
2. Insurance Exemption - All Clients are insurance companies. 
3. De Minimis Exemption - Fewer than 15 clients in last 12 months and does not advise registered investment companies. 

IAs (NOT IARs) must pay a filing fee and complete ADV through IARD (operated by FINRA) 

• IA name, number of employees, nature of business
• Name, address, education, and 10-year business history of each partner, director, officer.
• How they maintain custody.
• If principal business consists of investment advisory advice. 
• Number and size of discretionary and nondiscretionary accounts. 

Maybe used as firms brochure, if it discloses.

1. Potential conflicts of interst
2. services and related fees
3. soft dollar arrangements
4. Types of analysis used and the types of securities.
5. Education and business background of those giving advice.
6. IAs balance sheet if it collects client funds in advance in excess of $1,200 (state is $500) in 6 month timeframe.

• Must be delivered to client no later than the time the contract is signed and delivered to clients annually thereafter, unless;
• It is with an investment company or annual fees are less than $500
• According to USA the brochure must be given 48 hours in advance or given 5 business days to cancel without penalty if given at time agreement is signed. 

• Adviser's name, address, website
• Financials, AUM
• Fees & types of clients
• Soft Dollar arrangements
• Code of Ethics
• Statement that registration is not an indication of skills or expertise. 
• Disciplinary information if relevant.
• Any bankruptcy in the last 10 years. 

• Material changes must be filed promptly (30 days)
• Routine changes within 90 days of fiscal year end
• Required annual renewal (90 days after fiscal year end)

ADV-W

ADV-E

ADV-NR

• ADV-W is full or partial withdrawal
• ADV-E is filed by independent public account within 30 days of suprise audit. 
• ADV-NR is filed by advisers with general partners who are Non-Residents.

• Investment Companies
• Qualified Clients - $1 million under management or $2 million in net worth. 
• Non-U.S. clients
• Individuals associated with the IA such as an officer
• 3(c)7 hedge funds 

• BDs - 3 years with first 2 years easily accessible.
• IAs - 5 years with first 2 years easily accessible
• Maybe maintained in physical form, microfilm, microfiche or electronically (must be WORM). 

• POAs
• Written Agreements
• All client IA and IAR transactions within 10 days of quarter end
• all communications sent to 10 or more (advertising)
• Code of Ethics
• Ledgers and trade blotters
• order memorandums
• confirmations
• Complaints

Solicitors

• Based on Modern Portfolio Theory
• Examines trade off between risk and reward.
• Analyzes portfolio as a whole.
• recognizes need for diversification in a portfolio
• no restrictions on investments.

Acceptable Soft Dollar Arrangments

Acceptable (must be in ADV 2 or brochure)

• Research reports
• Analysis
• Market Data
• Seminars
• Software for analysis

Unacceptable

• Computer Hardware
• Telephone lines
• Hiring personal
• Rent
• Travel, entertainment, or meals

• Referring to mutual fund as "no load" when 12b-1 is higher than .25% of average net fund assets.
• Discretion without written authorization.  IAs may excercise oral discretion for 10 days. 
• Failing to deliver a final prospectus when a new issue is sold. 
• Syndicate members withholding sales of IPO shares
• Splitting commissions with another agent unless they are with similiar BDs and registered in same state. 
• IAs must segregate cash and securities but BDs do not. 
• AGents sharing in profits in an account...unless
• Selling away, Painting the tape, frontrunning.

• Selling away - Executing trades that are not recorded on the BDs books.
• Painting the tape - artificially trading a security to give the imporession that there is more trading activity in stock volume than there actually is.
• Frontrunning- when an agent or firm places a trade in advance of a larger client firm with knowledge. 

• Must obtain client's consent
• Disclose each trade date and comp earned.
• Disclose conflicts of interest
• Annually send a statement with total number of agency cross transactions and comp earned.

• Occurs when an adviser buys from or sells to a client a security out of it's own inventory. 

• Offer - Any attempt to dispose of a security for value
• Sale -  Any agreement or contract to sell a security
• Offer and Sale include - warrants attached to a bond, stock which gives issuer the right to demand more capital, assessable stock
• Non-assessable stock is neither an offer or a sale and therefore not subject to the USA.

• Originated in the state
• directed into and recieved in the state, or
• accepted or transacted in the state.

Means

• By Mail, two states at the most and not the state to which mail is forwarded.
• television, one state only. Where the microphone is located.
• Newspaper, one or no state.  state in which it is published unless more than 2/3rds is outside the state. 

Enforcement by Administrator

(cease and desist order, injunctions)

• Orders must be appealed in state court within 60 days.
• Administrator may ask court to issue injunction

• Client waives right to sue if they don't respond within 30 days. 
• registered person may offer to buy back security plus interest minus an income recieved. 
• A customer may still initiate civil action if they receive the letter after selling the security. 

• 3 year jail sentence; $5,000 fee or both. 
• Five year statute of limitations

1. U.S. gov't and agency securities
2. Municipal securities
3. Issued by banks
4. Issued by non-profits
5. Short-term corp debt under 270 days
6. Small business investment companies 

1. Rule 147 Intrastate Exemption: Confined to one state.
2. Regulation A Small Issue Exemption: No more than $5 mill raised in 12 months.  Made through offering ciruclar.
3. Regulation D Private Placement Exemption:  No more than 35 non-accredited investors, but any number accredited.  Disclosures made through offering memorandum. 

• $10,000 and/or imprisonment of 5 years. 
• Statute of limitations is 3 years from occurence or 1 year from discovery.