investment securities law
The Securities and Exchange Commission (SEC) lists the main laws governing the securities industry as:
The following descriptions of securities laws are based on SEC's interpretation of the laws. Of the securities laws, the oldest securities law governing the investment industry, the Securities Act of 1933, has the objective of requiring that investors receive financial and other significant information concerning securities being offered for public sale. Also, the law aims to prohibit deceit, misrepresentations, and other fraud in the sale of securities. You can read full text of the law at www.law.uc.edu/CCL/33Act/ Investment Securities Law - Securities Exchange Act of 1934The Securities Exchange Act of 1934 created the Securities and Exchange Commission (SEC). The Act gives the SEC authority over all aspects of the securities industry. These powers include the power to register, regulate, and oversee brokerage firms, transfer agents, and clearing agencies as well as the nation's securities self regulatory organizations (SROs). Securities Exchange Act of 1934 also identifies and aims to prohibit certain types of behavior in the markets and gives the SEC powers over regulated entities and persons associated with them. The Act also empowers the SEC to require periodic reporting of information by companies with publicly traded securities. You can read the full text of the Act at www.law.uc.edu/CCL/34Act/ Investment Securities Law - Public Utility Holding Company Act of 1935The Public Utility Holding Company Act of 1935 regulates interstate holding companies engaged, through subsidiaries, in the electric utility business or in the retail distribution of natural or manufactured gas. These companies, unless exempted, are required to submit reports providing information concerning the organization, financial structure, and operations of the holding company and its subsidiaries. You can read the text of the law at www.law.cornell.edu/uscode/15/ch2C.html. Investment Securities Law - Trust Indenture Act of 1939The Trust Indenture Act of 1939 regulates debt securities such as bonds, debentures, and notes offered for public sale. According to SEC, even though such securities may be registered under the Securities Act, they may not be offered for sale to the public unless a formal agreement between the issuer of bonds and the bondholder, the trust indenture, conforms to the standards of this Act. You can read the full text of the law at: www.law.cornell.edu/uscode/15/ch2AschIII.html Investment Securities Law - Investment Company Act of 1940The Investment Company Act of 1940 regulates the organization of companies, including mutual funds, that engage primarily in investing, reinvesting, and trading in securities, and whose own securities are offered to the investing public. The Investment Company Act of 1940 aims to minimize conflicts of interest that arise in these investing operations. Requirements under the Act include these companies to disclose their financial condition and investment policies to investors when stock is initially sold and, subsequently, on a regular basis. You can read the text of the law at www.law.uc.edu/CCL/InvCoAct/ Investment Securities Law - Investment Advisers Act of 1940The Investment Advisers Act of 1940 regulates investment advisers. With certain exceptions, the Act requires that firms or sole practitioners compensated for advising others about securities investments must register with the SEC. Also, these market participants must conform to regulations designed to protect investors. Since the Act was amended (in 1996), generally only advisers who have at least $25 million of assets under management or advise a registered investment company must register with the SEC. You can read the text of the law at www.law.uc.edu/CCL/InvAdvAct/ Investment Securities Law - Sarbanes-Oxley Act of 2002The Sarbanes-Oxley Act introduced a number of reforms to enhance corporate responsibility, enhance financial disclosures and combat corporate and accounting fraud. The Act also created the Public Company Accounting Oversight Board (PCAOB), which oversees activities of the auditing profession. You can read the full text of the law at: www.law.uc.edu/CCL/SOact/soact.pdf |