The Washington herald., 1921-04-16
Prevalence of Irresponsi-
BILE Brokers Makes Or
der Necessary.
SWEEPING TERMS
Heavy Fines and Imprison-
ment Provided for Active
Unlicensed Dealers.

enactment OF drastic 'Dlue SKY
law for the District of Columbia has
been agreed on. and the District
tions to press it before Congress at
an early date. The bill. as drawn
up, will be presented to the District
Of Columbia Bankers Association at
their regular meeting to be held at
the New willard on next Monday
night for their approval. The draft
OF the measure is the joint work of
the Bankers Association and the
Washington Stock Exchange, the
committee in charge of the drafting
being composed of Eugene E. ThOmp-
son, chairman; H. H. Mckee. w. T.
GalIiher, Victor B. Deyber and r. 4.
, Cissel.
The terms of the bill are sweep
ing. and provide heavy fines and i'm
prisonment for all stock peddlers or
brokers engaging in business with
out a license. Prevalence of ire
sponsible dealers in stocks and
bonds has increased to an alarming
degree, the bankers assert. and
many public men have been vic
timized, making necessary the en-
actment of a stringent law.
The complete text of the law fol-
lows:
BE it enacted by the Senate and
House of Representatives of the
United States of America in Con-
Sec l. That when used in this
act
The term person shall include
partnerships and corporations, and
the word corporation" shall include
trusts associations and groups of in
dividuals whose capital is divided
into shares or is represented by GER
tificates.
The term commissioners means
the Commissioners of the District of
Columbia
The term securities shall include
stocks, bonds, debentures, notes.
participation certificates, certificates
of shares or interest, pre-organiza-
tion certificates and subscriptions,
certificates evidencing shares in
trust estates or association and
profit-sharing certificates, by what
soever name designated.
The term sell means any act by
which a sale. barter. or exchange,
is made and the term sell and sale
shall include issuance, an attempt
to sell, an option of sale, a solicita-
tion of a sale, a subscription. or an
offer to sell, directly or indirectly
or by an agent. or circular, letter
or advertising, or otherwise.
The term broker shall mean and
include every person, other than a
salesman. who in the District Co
lumbia engages either wholly or in
part in the business of selling. or
otherwise dealing in, any security
issued by another person, or of un-
derwriting any issue of securities or
of purchasing or otherwise acquir-
ing such securities for another or
with the purpose of reselling them.
or of offering them for sale to the
public, for a commission or at a
profit
The term salesman shall mean
and include every person. employed
or appointed or authorized by a per-
son or broker who shall. within the
District of Columbia, either as an
employe or otherwise, for a COM
pensation or the expectation of COM
pensation, sell any security to any
person
words importing the singular
number shall be held to include the
plural, and vice versa, except where
such construction would be un-
reasonable.
Statements Requested.
Section 2. That if it shall appear
to the Commissioners that in the
selling of any securities within the
District Of Columbia any person is
employing or about to employ any
device, scheme, or artifice to de-
fraud. or for obtaining money
or property by means of any
false or fraudulent pretense. repre-
sentation or promise, and they be-
lieve It to be in the interest of the
public that an investigation be made
with a view to the issuance of an
order. such as herein provided, they
may require such person to file with
them a statement in writing, under
oath. as to all facts and circum-
stances concerning the subject mat
public interest to investigate. and
for that purpose may prescribe
forms upon which such statement
shall be made.
The Commissioners may require,
in addition thereto, such further
data and information as they may
deem relevant and make such spe-
cial investigation as they may deem
necessary in connection with such
matter: and for the purposes of this
act the Commissioners or their dep
uty. duly authorized in writing by
them. shall have power to require
by subpoena the attendance and tes-
timony of witnesses and the produc-
tion of any books. accounts, records
and correspondence relating to any
matter which the Commissioner are
authorized by this act to consider or
Investigate. The Commissioners or
their duly authorized deputy may
sign subpoenas, administer oaths
and affirmations, examine witnesses
and receive evidence.
Supreme Court to Aid.
in case of disobedience to a sub
poens or of the contumacy of any
witness appearing before the Com
missioners or their duly authorized
deputy. the Commissioners may in
woke the aid of the Supreme Court
of the District of Columbia, and
such court may thereupon issue an
order requiring the persons sub
poenaed to obey the subpoena, or to
give evidence touching the matter
In question. Any failure to obey
such order Of the court may be pun
Ashed by such court as a contempt