By Linda Kleindienst

  TALLAHASSEE – Prompted by a series of high profile securities fraud cases, a push is on for the Florida Legislature to strengthen state laws to protect investors.

   “Recent headlines and alleged fraud have clearly identified the need to have an ‘all hands on deck’ approach when helping protect Floridians and their investments,” Attorney General Bill McCollum said on Wednesday.

    Filed by Rep, Tom Grady, R-Naples, a securities attorney and expert in securities regulation, the measure (House Bill 483) would broaden the state’s investigative abilities and enhance the registration requirements for investment advisors and dealers. It will also allow Florida’s attorney general to participate in civil investigations with the approval of the Office of Financial Regulation.

    “In the wake of the Madoff scandal, which has directly affected over two dozen of my constituents, strengthening the state’s ability to prevent fraud is the first step in restoring consumer confidence in investments,” Grady said.

   The companion bill (Senate Bill 1126) has been filed by Sen. Garrett Richter, R-Naples, a banker and chairman of the Senate Banking and Insurance Committee.

   “The integrity of our markets is critical to building a strong economy,” Richter said. “This legislation will reinforce our regulatory system and bolster investor trust.”

   The proposed legislation enhances the Office of Financial Regulation’s powers by authorizing the emergency suspension of persons and firms for failure to provide financial books and records to OFR. It would also allow the adoption of sanction guidelines for registrants who violate the Florida Securities and Investor Protection Act.

    The measure would also allow the Office of Financial Regulation to increase the penalties for violators of state law – and punishment could include suspending or permanently barring violators from continuing to operate in Florida. It would also strengthen the licensure registration process by providing additional grounds for denial of a registration, including imposing disqualifying periods for persons who have been convicted of certain crimes.

   “There is a need to reinforce our regulatory framework. The proposed legislation will provide…the means to take swift action against violators,” said Alex Hager, interim Commissioner of the Office of Financial Regulation.

   Grady said the bill likely will not affect anyone who has already been arrested for investment-related crimes, since the effective date if it is passed would be July.

   Earlier this week, the Securities and Exchange Commission announced that former financial advisor Bernard Madoff agreed to a proposed partial judgment in a civil case brought against him by the Commission. Madoff also faces criminal charges in the U.S. District Court in Manhattan relating to allegations he bilked investors out of more than $50 billion in a Ponzi scheme. Thousands of Floridians and many charities reportedly fell victim to Madoff’s investment schemes.