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STATE OF
OFFICE OF SECURITIES
121 STATE HOUSE STATION
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)
IN THE MATTER OF: )
)
CONSENT AGREEMENT
Means Investment Co., Inc. ) No. 05-076-CAG
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This Agreement is entered into between
the State of Maine Office of Securities ("the Office") and Means Investment
Co., Inc. (“Means” or “the firm”), a broker-dealer and investment adviser located
in Bangor, Maine.
WHEREAS,
the parties agree as follows:
1.
In August 2004, Means unilaterally terminated
its investment advisory agreements with its investment advisory clients and all
of Means investment adviser clients were automatically switched to brokerage accounts.
2.
At the time it was making the changes
described above, Means advised its investment advisory clients that it was changing
clearing firms, but failed to advise them that their agreements would be terminated
and that the accounts would be changed to brokerage accounts.
3.
Pursuant to the investment adviser agreements
between Means and its investment advisory clients, Means was required to give
its clients notice of the termination.
4.
It is Securities’ position that by terminating
its investment advisory agreements without providing the notice required pursuant
to the agreement, and by changing those accounts to brokerage accounts without
obtaining their clients’ permission, Means has failed to fulfill its fiduciary
duty to its investment advisory clients and has engaged in an unethical business
practice, which is a violation of 32 M.R.S.A. §10313(G) and Chapter 515, Section
14, of the Office’s rules.
5.
Both parties desire an expeditious resolution
of this matter.
NOW
THEREFORE, without trial or adjudication of any issue of fact or law, and
without Means admitting or denying that its conduct violated the Revised Maine
Securities Act, it is agreed that:
1. Means will comply with all legal requirements governing persons acting
as securities broker-dealers and investment advisers in the State of Maine at
all times from the date hereof;
2. In lieu of Securities seeking the imposition of a penalty for the allegations
contained herein, Means will pay the sum of $2,500.00 to the Office upon Means’
execution of this Agreement; and
3. Securities will not take further action against Means based solely upon
the activity at issue in this Consent Agreement.
July 26, 2005 s/Christine
A. Burenn
Date
Christine A. Bruenn
Securities Administrator
July 20, 2005 s/Paul B.
Means
Date
Paul B. Means
President
Means Investment Co., Inc.