Issue: Under Kansas law, when does a ‘security’ involve a viatical investment?
| Area of Law: | Corporate & Securities |
| Keywords: | Viatical investment; Offer, sale, or purchase of a security; Exception |
| Jurisdiction: | Kansas |
| Cited Cases: | None |
| Cited Statutes: | K.S.A. 17-12a501 |
| Date: | 10/01/2014 |
K.S.A. 17-12a501 only prohibits certain actions made “in connection with the offer, sale, or purchase of a security.” Id. (emphasis added). Generally, in most cases, a “viatical investment” is a security within the meaning of the statute. K.S.A. 17-12A102(28(D). However, there is an important exception applicable here: The term “Viatical Investment does not include . . . the bona fide assignment of a life insurance policy to a bank, savings bank, savings and loan association, credit union, or other licensed lending institution as collateral for a loan.” NASAA Guidelines Regarding Viatical Investments § I.B.14.c.
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