76875313.1-503Virginia Decodedhttps://vacode.org2016CorporationsSecurities ActUnlawful PracticesUnlawful advice1956, c. 428; 1987, c. 678.http://law.lis.virginia.gov/vacode/13.1-503//13.1-503/13.1/5/2/13.1-50313.1-522It shall be unlawful for any person who receives directly or indirectly any consideration from another person primarily for advising such other person as to the value of securities or their purchase or sale, whether through the issuance of analyses or reports or otherwise,sectionAA1 To employ any device, scheme, or artifice to defraud such other person,sectionA1A12 To engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon such other person,sectionA2A22 Acting as principal for his own account, knowingly to sell any security to or purchase any security from a client, or acting as broker for a person other than such client, knowingly to effect any sale or purchase of any security for the account of such client, without disclosing to such client in writing before the completion of such transaction the capacity in which he is acting and obtaining the consent of the client to such transaction. The prohibitions of this subdivision shall not apply to any transaction with a customer of a broker-dealer if such broker-dealer is not acting as an investment advisor in relation to such transaction, orsectionA3A32 To engage in dishonest or unethical practices as the Commission may define by rule.sectionA4A42In the solicitation of advisory clients, it shall be unlawful for any person to make any untrue statement of a material fact, or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.sectionBB1Except as may be permitted by rule or order of the Commission, it shall be unlawful for any investment advisor to enter into, extend, or renew any investment advisory contract unless it provides in writing:sectionCC1 That the investment advisor shall not be compensated on the basis of a share of capital gains upon or capital appreciation of the funds or any portion of the funds of the client;sectionC1C12 That no assignment of the contract may be made by the investment advisor without the consent of the other party to the contract; andsectionC2C22 That the investment advisor, if a partnership, shall notify the other party to the contract of any change in the membership of the partnership within a reasonable time after the change.sectionC3C32Subdivision 1 of subsection C of this section shall not prohibit an investment advisory contract which provides for compensation based upon the total value of a fund averaged over a definite period, or as of definite dates or taken as of a definite date.sectionDD1The Commission may by rule or order adopt exemptions from subdivision 3 of subsection A and subdivisions 1, 2 and 3 of subsection C of this section where such exemptions are consistent with the public interest and within the purposes fairly intended by the policy and provisions of this chapter.sectionFF1