§ 192.340 - Prohibited sales practices.

§ 192.340 What Prohibited sales practices are prohibited?.

(a) Offers, sales, or purchases of conversion shares. In connection with offers, sales, or purchases of conversion shares under this part, you a savings association and your its directors, officers, agents, or employees may not:

(1) Employ any device, scheme, or artifice to defraud;

(2) Obtain money or property by means of any untrue statement of a material fact or any omission of a material fact necessary to make the statements, in light of the circumstances under which they were made, not misleading; or

(3) Engage in any act, transaction, practice, or course of business that operates or would operate as a fraud or deceit upon a purchaser or seller.

(b) Conversion. During your the conversion, no person may:

(1) Transfer, or enter into any agreement or understanding to transfer, the legal or beneficial ownership of subscription rights for your the savings association's conversion shares or the underlying securities to the account of another;

(2) Make any offer, or any announcement of an offer, to purchase any of your the savings association's conversion shares from anyone but youthe savings association; or

(3) Knowingly acquire more than the maximum purchase allowable under your the savings association's plan of conversion.

(c) Exceptions. The restrictions in paragraphs (b)(1) and (b)(2) of this section do not apply to offers for more than 10 percent of any class of conversion shares by:

(1) An underwriter or a selling group, acting on your the savings association's behalf, that makes the offer with a view toward public resale; or

(2) One or more of your the savings association's tax-qualified employee stock ownership plans so long as the plan or plans do not beneficially own more than 25 percent of any class of your the savings association's equity securities in the aggregate.

(d) If any Violations. Any person is found to have violated the restrictions in paragraphs paragraph (ba) or (1) and (b)(2) of this section , they may face prosecution may become subject to an enforcement action, civil money penalties, criminal prosecution, or other legal action.