Consequences of Non Compliance
Failure to comply with registration requirements or an eligible exemption can have many consequences for an issuer.
First of all, failure to comply creates a civil liability for the issuer pursuant to NMSA 58-13C-509.
Additionally, failure to comply with securities laws in an offering may hamper any future capital formation attempts because the past error has to be corrected, usually through a rescission offer, and/or because of the requirement to disclose the liability arising from the original non- compliance.
Finally, failure to comply is illegal and is subject to an action by the Securities Director. According to NMSA 58-13C-603, the Director may take action to enjoin the act, practice or course of business and to enforce compliance with the New Mexico Uniform Securities Act or a rule adopted or order issued pursuant to that act.