2013 New York Consolidated Laws
GBS - General Business
Article 23-A - (352 - 359-H) FRAUDULENT PRACTICES IN RESPECT TO STOCKS, BONDS AND OTHER SECURITIES
359-E - Definitions.

 
    § 359-e. Definitions. Registration requirements.
    1.  The following terms, whenever used or referred to in this article,
  shall have the following meaning  unless  a  different  meaning  clearly
  appears from the context:
    (a) A "dealer" shall mean and include any person, firm, association or
  corporation  engaged  in  the  business of buying and selling securities
  from or to the public within or from this  state  for  his  or  its  own
  account,  through  a broker or otherwise, except a bank unless such bank
  is considered a dealer under the  federal  securities  exchange  act  of
  1934,  but does not include any person, firm, association or corporation
  in so far as he or it buys or sells securities for his or its bona  fide
  investment  account,  either individually or in some fiduciary capacity.
  The term "dealer" shall, except as otherwise provided in  this  article,
  also  include  a  person,  firm,  association  or corporation selling or
  offering for sale from or to  the  public  within  or  from  this  state
  securities  issued by it. No person shall be deemed to be a "dealer", as
  defined in this subdivision, or a broker, as defined in subdivision  (b)
  of  this section, solely by reason of the fact that he is engaged in the
  business of (i) selling, offering for sale, purchasing  or  offering  to
  purchase any security or securities to, from or through any bank, dealer
  or  broker, or to or from any syndicate, corporation or group formed for
  the specific purpose of acquiring such  securities  for  resale  to  the
  public  directly  or  through  other  syndicates  or groups, or (ii) any
  offer,  sale  or  distribution  by  an  issuer   of   stock   dividends,
  nontransferable  warrants  or  transferable  warrants exercisable within
  ninety days of  their  issuance  to  existing  stockholders,  securities
  issued  upon  conversion  of  convertible  securities  and  exercise  of
  warrants  and  securities  issued  as  part  of  a  recapitalization  or
  reclassification  to  existing stockholders of the same issuer, or (iii)
  selling, offering for sale,  purchasing  or  offering  to  purchase  any
  security   or  securities  on  the  floor  of  any  securities  exchange
  registered as  a  national  securities  exchange  under  the  securities
  exchange   act   of  nineteen  hundred  thirty-four.  No  person,  firm,
  association or corporation shall be deemed to be a "dealer", as  defined
  in  this  subdivision,  solely by reason of selling or offering for sale
  any  security  or  securities  to   any   bank,   corporation,   savings
  institution,  trust  company,  insurance company, investment company, as
  defined in the federal investment company act of nineteen hundred forty,
  pension or profit-sharing  trust,  or  other  financial  institution  or
  institutional  buyer,  whether  the  purchaser  is acting for himself or
  itself or in some fiduciary capacity, as part of a private placement  of
  securities.
    (b) A "broker" shall mean and include any person, firm, association or
  corporation,  other  than a dealer, engaged in the business of effecting
  transactions in securities for the account of others within or from this
  state, but does not include a bank unless  such  bank  is  considered  a
  broker under the federal securities exchange act of 1934.
    (c)  A  "salesman"  shall  mean and include every person employed by a
  broker or dealer as said terms are defined  in  this  section,  for  the
  purpose of representing such broker or dealer in the sale or purchase of
  securities to or from the public within or from this state.
    (d) A "principal" shall mean and include every person or firm directly
  or indirectly controlling any broker or dealer.
    (e)  A  "bank"  shall mean and include a state or national bank, trust
  company or savings institution incorporated under the laws  and  subject
  to  the  examination,  supervision  and  control  of any state or of the
  United States or of any insular possession thereof.

    2. No dealer or broker shall sell or offer for sale to or purchase  or
  offer  to  purchase  from  the  public  within  or  from  this state, as
  principal, or broker, any securities issued or to be issued  unless  and
  until  a notice, to be known as the "state notice," containing the name,
  business  or  post  office  address  of  such  dealer or broker and if a
  corporation the state or country of  incorporation  thereof,  and  if  a
  partnership  the  names  of  the  partners, shall have been filed in the
  department of state. Such notice shall be in the following form:
 
                                STATE NOTICE
 
  Name(s) of dealer(s), broker(s) ........................................
  Business address(es) or post office address(es) (state which)
  ........................................................................
  If a corporation, the state or country in which incorporated.
  ........................................................................
  If a partnership, the names of the partners ............................
    3. It shall be unlawful for any dealer, broker or salesman to sell  or
  offer  for  sale  to  or  purchase  or offer to purchase from the public
  within or from this state, any securities issued or to be issued, unless
  and until such dealer, broker or salesman  shall  have  filed  with  the
  department  of  law  a registration statement as provided herein. A real
  estate broker or salesman licensed under article twelve-A  of  the  real
  property  law  who  is  not  acting as a dealer shall be deemed to be in
  compliance with such registration  statement  filing  requirements  with
  respect  to the sale of securities constituting cooperative interests in
  real estate, including shares  of  cooperative  apartment  corporations,
  commercial  cooperative  corporations,  condominiums,  and  interests in
  homeowners associations.
    (a) The registration statement relating to dealers and brokers, to  be
  known  as  the  "broker-dealer statement" shall contain such information
  pertaining to the business history for the last  preceding  five  years,
  criminal  record, and educational background of the applicant and his or
  its partners, officers, directors or  other  principals  thereof  deemed
  pertinent  by  the  attorney-general. The attorney-general may prescribe
  forms for the use of such applicants.
    (b) The registration statement relating to salesmen, to  be  known  as
  the "salesman's statement," shall contain such information pertaining to
  the  business history for the last preceding five years, criminal record
  and educational background of the  applicant  deemed  pertinent  by  the
  attorney-general.  The  attorney-general  may prescribe forms for use of
  such applicants and, as a condition of registration, shall require  that
  prior  to the filing of such a registration statement any such applicant
  shall undertake and successfully complete the uniform  securities  agent
  state  law  examination  ("series 63") or the uniform combined state law
  examination ("series 66") as administered by or on behalf of  the  North
  American  Securities  Administrators  Association,  Inc.  (NASAA) by any
  national  securities  association  or  national   securities   exchange;
  provided  that,  if  an  applicant  registers  with the attorney-general
  solely for the purpose of selling condominiums,  shares  of  cooperative
  apartment corporations or commercial cooperative corporations, interests
  in  homeowners  associations  or  interests  in timeshare projects, such
  applicant  shall  not  be  required  to  undertake  the   aforementioned
  examination as a condition of registration.
    (c)  The  registration  of  brokers, dealers and salesmen shall be for
  periods of four years commencing  on  January  fifth,  nineteen  hundred
  sixty.  Such  statements for brokers, dealers or salesmen shall be filed
  every four years within sixty days prior to the expiration of  the  four

  year period, provided that previously filed statements shall continue to
  be  effective  for a period of ninety days following the end of the four
  year period. Initial statements for those having no previous filing  may
  be made at any time and shall be effective from the date of filing for a
  period  of four years. All statements filed pursuant to prior provisions
  of law shall remain in effect  until  January  fifth,  nineteen  hundred
  sixty.
    4. The attorney-general may by rule or order provide for the filing of
  supplemental  statements  prescribed  by  him  which  shall contain such
  information  as  the  attorney-general  may  deem  necessary   to   keep
  reasonably current the information on file.
    5.  The department of law shall collect the following fees: (a) twelve
  hundred dollars for each broker-dealer's statement; (b)  twelve  hundred
  dollars  for  each  broker-dealer's  statement  filed by a person, firm,
  association or corporation selling or offering for sale from or  to  the
  public  within or from this state securities issued by it for any amount
  in excess of five hundred thousand dollars; (c)  three  hundred  dollars
  for  each broker-dealer's statement filed by a person, firm, association
  or corporation selling or offering for sale from or to the public within
  or from this state securities issued  by  it  for  any  amount  of  five
  hundred  thousand  dollars  or  less; (d) three hundred dollars for each
  broker-dealer's statement  filed  by  a  person,  firm,  association  or
  corporation  solely for the purpose of selling or offering for sale from
  or to the public within or from  this  state  securities  consisting  of
  condominiums, shares of cooperative apartment corporations or commercial
  cooperative   corporations,  interests  in  homeowners  associations  or
  interests in timeshare projects, plus fifteen dollars for each  partner,
  officer,  director  or  principal  of  any  such  firm,  association  or
  corporation;  (e)  one  hundred  fifty  dollars  for   each   salesman's
  statement; (f) thirty dollars for each supplemental statement; (g) three
  hundred dollars for each application granted pursuant to subdivision two
  of  section  three  hundred  fifty-nine-f  of  this article; and (h) two
  hundred twenty-five dollars for the issuance of a  "no  filing  required
  letter";  these fees shall obtain for both original statements and their
  renewals. No fee, however, shall be collected for filing a  supplemental
  statement  by  a  salesman  cancelling  his  prior  registration as such
  salesman.
    Any partner, officer, director or principal who is named as such in  a
  broker-dealer  statement and who shall act as a salesman for such broker
  or dealer, shall not be required to register as a salesman.
    6. Any false statement of  a  material  fact  contained  in  any  such
  broker-dealer  or  salesman's  statement or supplemental statement or in
  any certificate attached thereto shall constitute a  violation  of  this
  section within the meaning of section three hundred fifty-nine-g of this
  article.
    7. Any person, partnership, corporation, company, trust or association
  representing  in any manner that the state, the department of law or any
  officer thereof has recommended the purchase of any  stocks,  bonds,  or
  other securities, in advertising or offering such stocks, bonds or other
  securities  for  sale  shall  be  guilty  of a misdemeanor punishable as
  provided in subdivision two of section  three  hundred  fifty-nine-g  of
  this article.
    8.  After  this  subdivision  as hereby amended takes effect no dealer
  shall sell or offer  for  sale  to  the  public  within  this  state  as
  principal  or agent, any securities issued or to be issued which are not
  exempted from the  provisions  of  this  subdivision  by  section  three
  hundred and fifty-nine-f hereof unless and until such dealer shall cause
  to  be  filed a "further state notice" containing the information, other

  than the names of partners, required to be published by subdivision  two
  of  this  section,  but  opposite  the  heading "name of dealer", if the
  person or persons causing such notice to be filed are acting pursuant to
  the  provisions  of  this  subdivision,  there shall be added either the
  words "syndicate manager" or "syndicate managers" as the  case  may  be;
  and  in  addition  thereto and as part of each such further state notice
  the name of the security or securities, name, post  office  address  and
  state  or  country  of incorporation or organization of the corporation,
  association, common law trust or  similar  organization  issuing  or  to
  issue  the security or securities to be sold or offered for sale, in the
  following form:
 
                            FURTHER STATE NOTICE
 
  Name of security or securities .........................................
  Name of issuer of securities ...........................................
  Post Office address of issuer of securities ............................
  The state or country in which organized ................................
 
    Two or more  dealers  may  jointly  file  such  further  state  notice
  required  by  this  subdivision,  and  a  dealer or exchange must file a
  further state notice for each issue about to be offered  which  has  not
  heretofore  been  published  by  the  issuer.  A  syndicate  manager  or
  co-manager with an office in this state may file on behalf of an  entire
  syndicate.
    9.  A  broker-dealer  or  salesman registration statement or any other
  document is filed when it is received in the New York city office of the
  attorney-general.
    10. The attorney-general may from time to time in the public  interest
  make,  amend,  and  rescind such forms as are necessary to carry out the
  provisions  of  this  act,  including   forms   governing   registration
  statements   and   applications.   For   the   purpose   of  forms,  the
  attorney-general may classify securities, persons and matters within his
  jurisdiction, and may prescribe different  forms  and  requirements  for
  different classes.
    11.  It  is  unlawful  for  any  broker or dealer to employ a salesman
  unless the salesman is registered. The registration  of  a  salesman  is
  suspended  during any period when he is not associated with a particular
  broker or dealer registered under this act or a particular issuer.  When
  a salesman begins or terminates a connection with a broker or dealer, or
  begins  or  terminates  those  activities which make him a salesman, the
  salesman as well as the broker  or  dealer  shall  promptly  notify  the
  attorney-general.
    12.  All persons, including partners, officers, directors and salesmen
  employed by a member or a member organization of a  national  securities
  exchange, a national securities association, or any other broker-dealer,
  registered with the federal securities exchange commission or any broker
  or  dealer required to be registered with the department of law pursuant
  to this article except those dealers required to be registered solely by
  reason of the fact that they are engaged in selling or offering for sale
  securities  issued  by  themselves,  and  any  employee  of  a  clearing
  corporation  affiliated  with  any  such  registered national securities
  exchange or with any national securities association registered with the
  federal securities exchange commission, employed on or  after  September
  first,  nineteen  hundred  sixty-nine, who are regularly employed within
  the  state  of  New  York  shall,  as  a  condition  of  employment,  be
  fingerprinted.   Every  set  of  fingerprints  taken  pursuant  to  this
  subdivision shall be promptly submitted  to  the  attorney  general  for

  appropriate   processing,   except  that  individuals  fingerprinted  in
  compliance with the rules of the securities and exchange commission need
  not file  with  the  attorney  general  so  long  as  records  of  those
  fingerprints,  as  well  as  information  received  in response to their
  filing, are available  to  the  attorney  general  for  inspection.  The
  department  of law shall collect from a member or member organization of
  a national securities exchange, a national  securities  association,  or
  any   registered   broker-dealer   as  described  above  or  a  clearing
  corporation affiliated with  any  such  registered  national  securities
  exchange  or  with  any  such registered national securities association
  submitting fingerprints to the attorney general for processing a fee  in
  the  amount  prescribed  therefor  by  the  division of criminal justice
  services for each set of fingerprints submitted. Failure to comply  with
  this  section  shall  be deemed a violation of and a fraudulent practice
  within the meaning of this article.
    12-a. Any employee of  a  national  securities  exchange  or  national
  securities  association  registered  with  the  federal  securities  and
  exchange commission, and any  employee  of  a  clearing  corporation  or
  securities  information  processor  affiliated  with any such registered
  national securities exchange or national securities association, and who
  are regularly employed within  the  state  of  New  York,  shall,  as  a
  condition  of  employment,  be  fingerprinted. Every national securities
  exchange,  national  securities  association,  clearing  corporation  or
  securities information processor that is required to submit fingerprints
  pursuant  to  this  section  shall  also  obtain  fingerprints  from any
  individual not employed by such organization who  provides  services  to
  such  organization  within  the  state  of  New  York  provided that the
  individual has  access  to  records  including  electronic  records,  as
  defined  by  section  three  hundred two of the state technology law, or
  other material or secure buildings or secure property, which  place  the
  security of such organization at risk.
    Every  set of fingerprints taken pursuant to this subdivision shall be
  promptly submitted to  the  federal  bureau  of  investigation  for  the
  purpose  of  a  nationwide criminal history check. Such reports received
  from the federal bureau of investigation  shall  be  kept  confidential,
  although  the  contents  of any such report may be disclosed to exchange
  officials involved in personnel and security matters,  to  the  attorney
  general,  to  law  enforcement  authorities  and  to  the securities and
  exchange commission. Unless inconsistent with federal law,  fingerprints
  supplied  by  such employee or employment applicant shall be returned to
  such person upon termination or denial of such employment.  Fingerprints
  supplied  by such other individuals providing services shall be returned
  upon completion of such services.
    12-b. Any employee of a designated contract market, as  that  term  is
  defined  in  the  Commodity  Exchange  Act,  under  the authority of the
  federal Commodity Futures Trading Commission,  and  any  employee  of  a
  derivatives  clearing  organization,  as  that term is defined under the
  Commodity Exchange Act, that is  affiliated  with  any  such  designated
  contract  market, and who are regularly employed within the state of New
  York, shall, as a  condition  of  employment,  be  fingerprinted.  Every
  designated contract market and derivatives clearing organization that is
  required  to  submit  fingerprints  pursuant  to this section shall also
  obtain  fingerprints  from  any  individual   not   employed   by   such
  organization who provides services to such organization within the state
  of New York provided that the individual has access to records including
  electronic records, as defined by section three hundred two of the state
  technology  law,  or  other  material  or  secure  buildings  or  secure
  property, which place the security of such organization at risk.

    Every set of fingerprints taken pursuant to this subdivision shall  be
  promptly  submitted  to  the  federal  bureau  of  investigation for the
  purpose of a nationwide criminal history check.  Such  reports  received
  from  the  federal  bureau  of investigation shall be kept confidential,
  although  the contents of any such report may be disclosed to designated
  contract market or derivatives clearing organization officials  involved
  in  personnel  and  security  matters,  to  the attorney general, to law
  enforcement authorities and to the Commodity Futures Trading Commission.
  Unless inconsistent with federal  law,  fingerprints  supplied  by  such
  employee  or  employment applicant shall be returned to such person upon
  termination or denial of such employment. Fingerprints supplied by  such
  other  individuals  providing services shall be returned upon completion
  of such services.
    13. (a) The attorney general may by regulation, rule or order  provide
  an  alternative  method  of  registration by which any dealer, broker or
  salesman acting as such or as principal in more than one  state  or  who
  engages  in  multi-state securities offerings may supply the information
  otherwise required to be furnished in  the  state  notice,  registration
  statement,  supplemental statements and further state notice mandated by
  subdivisions  two,  three,  four  and  eight  of  this   section.   Such
  alternative  method,  when complied with, shall be deemed to fulfill the
  filing requirements of subdivisions two, eight and nine of this section,
  and shall be in lieu thereof. The  regulation,  rule  or  order  of  the
  attorney  general  may  also  provide for alternative filing periods and
  expiration dates and an alternate method for the payment of fees, to  be
  known  as  "in  lieu  filing fees", which shall be collected pursuant to
  such regulation, rule or order of  the  attorney  general  in  the  same
  amounts  as,  and  for  the  same  information  otherwise required to be
  collected for statements filed as specified by subdivision five of  this
  section.
    (b)  No  alternative  method  may  be provided by the attorney general
  which does not have, as its  purpose,  the  facilitation  of  a  central
  registration   depository  whereby  brokers,  dealers  or  salesmen  can
  centrally or simultaneously register and pay  fees  for  all  states  in
  which  they  plan  to transact business which requires registration. The
  attorney general is hereby authorized to  enter  into  an  agreement  or
  otherwise   facilitate   such   alternative  method  with  any  national
  securities   association,   national   securities   exchange,   national
  association of state securities administrators or similar association or
  agents thereof to effectuate the provisions of this subdivision.
    (c) Any false statement of a material fact contained in any substitute
  for  a  broker-dealer  statement or salesman's statement or supplemental
  statement  which  is  provided  pursuant  to  the   attorney   general's
  regulation,   rule   or   order  specified  in  paragraph  (a)  of  this
  subdivision, shall constitute a violation of  this  section  within  the
  meaning of section three hundred fifty-nine-g of this article.
    (d) It shall be unlawful for any dealer, broker or salesman to sell or
  offer  for  sale  to  or  purchase  or offer to purchase from the public
  within or from this state, any securities issued or to be issued, unless
  and until such dealer, broker or salesman shall have complied  with  the
  requirements  of  either:  (i)  the  regulation,  rule  or  order of the
  attorney general specified in paragraph (a) of this subdivision; or (ii)
  the filing of a state notice and registration statement and supplemental
  statements and further state notice as applicable to said dealer, broker
  or salesman, in accordance with subdivisions two, three, four and  eight
  of this section.

    (e)  To  the  extent  inconsistent  therewith,  the provisions of this
  subdivision shall supersede the provisions of any other  subdivision  of
  this section.
    14.  (a)  Definitions.  For purposes of this subdivision the following
  definitions shall apply:
    (i) "Commodity" means, except as otherwise specified by  the  attorney
  general  by  rule, regulation or order, any agricultural, grain, animal,
  chemical, metal or mineral product or byproduct,  any  gem  or  gemstone
  (whether  characterized  as  precious,  semi-precious or otherwise), any
  fuel (whether liquid, gaseous or otherwise), any foreign  currency,  and
  any other good, article, or material.
    (ii) "Commodity contract" means any account, agreement or contract for
  the  purchase  or  sale  of, or any option or right to purchase or sell,
  primarily for speculation or investment purposes  and  not  for  use  or
  consumption  by  the  offeree  or  purchaser,  one  or more commodities,
  whether for immediate or subsequent delivery or for storage and  whether
  or not delivery is intended by the parties, and whether characterized as
  a  cash  contract,  deferred  shipment  or  deferred  delivery contract,
  forward contract, futures  contract,  installment  or  margin  contract,
  leverage  contract, option, privilege, indemnity, bid, offer, put, call,
  advance guaranty, decline guaranty or otherwise. Any commodity  contract
  offered  for  sale or sold to a person other than a producer, processor,
  merchant, handler, commercial user or ultimate consumer of the commodity
  shall, in the absence of evidence to the contrary,  be  presumed  to  be
  offered for sale or sold for speculation or investment purposes.
    (iii)  "Commodity  broker-dealer"  means  any  person  engaged  in the
  business of selling or offering to sell  commodities  through  commodity
  contracts to the public within or from the state of New York.
    (iv)   "Commodity   salesperson"  means  any  person  employed  by  or
  representing a commodity broker-dealer in selling or offering  for  sale
  commodities through commodity contracts to the public within or from the
  state of New York.
    (v)   "Commodity   investment  advisor"  means  any  person  who,  for
  compensation, within or from the state  of  New  York,  engages  in  the
  business  of  advising members of the public, either directly or through
  publications or writings,  as  to  the  advisability  of  investing  in,
  purchasing, selling or holding commodity contracts.
    (b)   Any  person  acting  as  a  commodity  broker-dealer,  commodity
  salesperson or commodity investment advisor and any person  who  manages
  or  supervises any such broker-dealer, salesperson or investment advisor
  shall file a registration statement  with  the  attorney  general  as  a
  commodity  broker-dealer, commodity salesperson, or commodity investment
  advisor relating to the activity actually engaged in.
    (c) The attorney general may adopt rules and regulations governing the
  form and content of such registration statements for each such  activity
  which may include information pertaining to the business history for the
  last  preceding  five  years, record of criminal convictions, litigation
  history,  and  educational  background  of  the   registrant   and   the
  registrant's  partners,  officers,  directors or other principals deemed
  pertinent by the attorney general and the names of persons  employed  as
  commodity   salespersons   or   commodity  investment  advisors  by  the
  registrant.
    (d) The registration statement shall be effective for a period of  one
  year from the date of filing.
    (e)  The  attorney general shall by rule or regulation provide for the
  method of renewing such registration  statements  and  may  require  the
  filing  of  supplemental statements which shall contain such information

  as the attorney general may deem necessary to  keep  reasonably  current
  the information on file.
    (f)  The attorney general shall collect the following annual fees: one
  hundred dollars for each commodity broker-dealer registration  statement
  or  commodity  investment  advisor  registration  statement; twenty-five
  dollars for each commodity salesperson registration statement;  and  ten
  dollars for each supplemental statement.
    (g)  The  provisions  of  this  subdivision shall not apply to (i) any
  person who is a member or member firm of a national securities exchange,
  board of trade designated as a contract market by the Commodity  Futures
  Trading  Commission  pursuant to the commodity exchange act, as amended,
  the National Association of Securities Dealers, Inc.,  or  the  National
  Futures Association, Inc., or is an affiliate of such a member or member
  firm,  or employed by such a member or member firm or by an affiliate of
  such a member or member firm; (ii) any board of trade  designated  as  a
  contract  market  as  aforesaid;  (iii)  any  other  person  registered,
  temporarily licensed, or exempt from registration  under  the  commodity
  exchange  act,  as  amended,  or  the  rules and regulations promulgated
  thereunder  where  such  registration,  license  or  exemption   relates
  directly  to the activity engaged in; and (iv) any bank or trust company
  as defined in this article or any person acting as an  employee  of  any
  bank  or  trust  company  or  any licensed money transmitter or employee
  thereof.
    (h) In addition to those persons exempt under paragraph  (g)  of  this
  subdivision,  no  person  shall  be  required to register as a commodity
  investment advisor pursuant to paragraph (b) of this subdivision who  is
  (i)  a  lawyer,  accountant, engineer, or teacher who renders investment
  advice solely incidental to the practice of his or her profession;  (ii)
  a  broker  or  dealer  in  securities  or a commodity broker-dealer or a
  commodity salesperson who renders investment advice solely incidental to
  the conduct of his or her business as a broker or dealer  in  securities
  or  a  commodity  broker-dealer or a commodity salesperson respectively,
  and who receives no  special  compensation  for  such  advice;  (iii)  a
  publisher  of,  editor  of,  or writer for a bona fide newspaper or news
  magazine, whether published in print or by electronic means; or  (iv)  a
  person  who  during  the  course  of the preceding twelve months has not
  advised more than fifteen persons as to the  advisability  of  investing
  in,  purchasing, selling or holding commodity contracts and who does not
  hold himself out generally to the public  as  engaging  in  any  of  the
  activities set forth in subparagraph (iii), (iv) or (v) of paragraph (a)
  of this subdivision.
    (i) The provisions of this subdivision shall not apply to any contract
  or  transaction involving the sale of commodities by the owner or lessee
  of real property upon which such commodities are grown  or  raised,  the
  sale  of  items by art dealers or licensed auctioneers at public auction
  or the sale or resale by  a  distributor  or  wholesaler  of  goods  for
  consumption by the public.
    (j)  Any  person  required to be registered by this subdivision who is
  not registered shall be guilty of a misdemeanor punishable  as  provided
  in the penal law.
    (k)  Any person who engages in a business requiring registration under
  this article and who knowingly employs  two  or  more  persons  for  the
  purpose  of  engaging  in  conduct requiring registration as a commodity
  broker-dealer, commodity salesperson  or  commodity  investment  advisor
  under  this  article  with the knowledge that they are not so registered
  shall be guilty of a class E felony.
    (l) A violation of this  subdivision  shall  constitute  a  fraudulent
  practice as that term is used in this article.

    (m) If any provision of this subdivision or the application thereof to
  any  persons  or  circumstances  is  held  invalid,  the validity of the
  remainder of this subdivision or of the application of such provision to
  other persons and circumstances shall not be affected thereby.