Blue Sky Laws

A blue sky law is a law in the United States that regulates the offering and sale of securities to protect the public from fraud. Though the specific provisions of these laws vary among states, they all require the registration of all securities offerings and sales, as well as of stock brokers and brokerage firms. Each state’s blue sky law is administered by its appropriate regulatory agency and most also provide private causes of action for private investors who have been injured by securities fraud.

The first blue sky law was enacted in 1911. Today, the blue sky laws of 40 of the 50 states are patterned after the Uniform Securities Act of 1956.