Glory- CTE
The objective of the Securities Act of 1933 law is to give full disclosure of all facts related to the security being offered.
A fedral law that requires all corporate bonds and other debt securities to be issued subject to indenture agreements approved by the SEC.
-Legislation separate from the Securities Exchange Act of 1934 would be more appropriate to govern this matter
-Trustees of indentures be disqualified where they have or acquire conflicts of interest incompatible with their fiduciary obligations
The Securities Exchange Act of 1934 law was designed to regulate post-issuance trading of securities by regulating security brokers and exchanges.
-This includes 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).
Trust Indenture Act of 1939
-Requires disclosure of important information by anyone seeking to acquire more than 5 percent of a company's securities by direct purchase or tender offer
-The SEC to require periodic reporting of information by companies with publicly traded securities
-Identifies and prohibits certain types of conduct in the markets and provides the Commission with disciplinary powers over regulated entities and persons associated with them
Securities Exchange Act of 1934
-Prohibit deceit, misrepresentations, and other fraud in the sale of securities.
-Requires that investors receive financial and other significant information concerning securities being offered for public sale.
If a Financial Advisor makes the wrong decision then the client they are working with can lose all their money and the Financial Advisor could lose their license or be reported to the SEC.
How this law effects Financial Advisors:
It governs the way in which the nation's securities markets and its brokers and dealers operate. Under this law Financial Advisors are expected to follow standards of conduct and financial responsibility rules.
Financial Advisors have to be registered and complete financial reporting requirements because it is unlawful for any person to sell notes, bonds, or debentures in interstate commerce unless the security have been issued under an indenture and qualified under the act.
Securities Act of 1933
- Often referred to as the "truth in securities" law
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