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Show Protecting Investors The Federal Government, under the guidance of President Roosevelt, Roose-velt, has passed a law seeking to prevent those interested in issuing securities from unloading upon an unsuspecting public investment of a doubtful character. The Federal Trade Commission estimates that $25,000,000,000 worth of worthless securities were unloaded on the public during the last ten years through representations that a-mounted a-mounted to misrepresentation and fraud. While the new law cannot actually actu-ally supervise every proposed transaction trans-action for an individual, it will require those who offer securities to the public to place, in the words of a statement issued by the Federal Fed-eral Trade Commission, "adequate L and true information before in-1 in-1 vestors, and to protect honest en-' en-' terprise seeking capital by honest ; representations against the capital ; afforded by securities offered through crooked . promotion and crooked misrepresentation." The Commission, however, warns the public that the fact that this ; information has been filed with it does not mean that the Commis-1 Commis-1 sion endorses or approves the se- curity or the company. The President also issued a ; statement concerning the purpose ' of the legislation. "If the country : is to flourish," said Mr. Roosevelt, "capital must be invested in en-' en-' terprise. But those who seek to draw upon other people's money must be wholly candid regarding the facts on which the investor's judgment is asked. 1 "To that end this bill requires publicity necessary for sound investment in-vestment it is, of course, no insurance in-surance against errors of judgment. That is the function of no government. govern-ment. It does give assurance, however, how-ever, that within the limit . of its powers, the federal government will insist upon knowledge of the facts cn which alone judgment can be based. "The new law also will safeguard against the abuses of high pressure pres-sure salesmanship in security flotations. flo-tations. It will require full disclosure dis-closure of all the private interests on the part of those who seek to sell securities to the public. "The law requires that both domestic do-mestic and foreign issues be registered re-gistered with the federal trade commission for 20 days before they are advertised or sold. The Com-I Com-I mission can issue a stop order a-: a-: gainst any security if it finds fraud or misrepresentation was involved." in-volved." t |
