367.815 Liability for false, misleading, or deceptive representations -- Bond or

395 words·~2 min read·/ky/367-815

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

deposit to insure veracity of statements -- Maintenance of records.

(1)Any person who offers a business opportunity and makes representations that are

false, misleading, or deceptive shall be liable to the consumer/investor of such

business opportunity in an amount equal to the sum of his actual damages or fifteen

hundred dollars ($1,500), whichever is greater, as well as the cost of the action

together with reasonable attorney's fees, as determined by the court.

(a)All persons registering pursuant to KRS 367.805 shall either furnish a bond

by a surety company authorized to do business in the Commonwealth or

establish a full cash certificate of deposit with a licensed and insured bank or

savings institution located in the Commonwealth to insure the veracity of all

statements contained in the registration. The amount of the bond or certificate

of deposit shall be in an amount equal to the total amount of the initial

payments under all business opportunity agreements the offeror has entered

into in the Commonwealth during the previous year but in no case shall the

amount be less than seventy-five thousand dollars ($75,000). The bond or

certificate of deposit shall be in the favor of the Attorney General of

Kentucky.

(b)Any person who is damaged by any violation of KRS 367.801 to 367.819, or

by the offeror's breach of contract for the business opportunity sale, or of any

obligation arising therefrom may bring an action against the bond or

certificate of deposit to recover damages suffered, provided that the aggregate

liability of the surety or trustee shall be only for the actual damages and shall

not exceed the amount of the bond or trust account.

(3)A person who has furnished a bond described in subsection

(2)of this section may

petition the office for release of the bond by submitting a verified statement that

such person has not offered business opportunities in the state for the last five

years.

(4)Any offeror of a business opportunity who has offered or sold in this state shall

maintain a complete set of books, records, and accounts of its business opportunity

sales. The sale documents shall be maintained on each transaction for a period of

four

(4)years after the date of agreement. The offeror shall make the books and

records available to the office upon demand at a location within the state.