The New York herald., 1922-03-02

latter would make it imperative that
broker have character and capital
and that he conduct his business in
a straightforward, honest, legitimate
manner. In other words, the broker
age house would be subjected to about
the same sort of scrutiny by the State
as bank or an insurance company.
Federal blue sky law is pending
before Congress with a favorable COM
mittee recommendation and with the
support Of the Investment Bankers
Association and other bodies of that
character
There is also pending before the
Legislature at Albany the blue sky
law designed to remedy the situation.
on which a hearing was held yester-
day. This is meeting with consider
able opposition from certain financial
sources, and il may be that it is not
without its Objectionable features.
But whether that law passes or not
it would not be impossible for the
bucket shop to live.
Oppose "Burden on Business
There is no doubt that the moment
the suggestion OF the District Attorney
reaches the possibility of becoming
a law there will be a lot of opposition
to that Various financial. brokerage
and banking organizations are said to
be opposed to licensing system, be-
cause, they argue. the system itself
would place burden on legitimate
business. and experience has shown,
they say. that it would be difficult to
obtain officials of such knowledge of
the intricacies Of finance TO administer
such law.
An effort TO impose a licensing sys-
tenn on the stock brokers of New York
undoubtedly would meet with strenu-
Gus opposition.
This article does not undertake TO
prescribe remedy that would be
agreeable to all. but is intended to
point out that action of some sort is
urgent.
There is rather persistent feeling
in the financial district that the Mar
tin law enacted about year ago has
not been put to the maximum Of its
efficiency. That law was passed with
the approval and support Of reputable
bankers and brokers, and, it is stated
in Wall Street. that considerable was
expected OF that law that has not yet
come to pass.
Under that law the Attorney
eral has wide powers of investigation
much broader than those OF the Dis
trict Attorney--and he lis empowered
TO take proper steps TO bring about
prosecutions as warranted by findings
made in such Investigations. He is
authorized also to appoint deputies to
carry out this work.
Needs No Complaints.
Moreover the powers Of the Attor-
ney- General Under the Martin law
differ further from those Of the Dis
trict Attorney in that the latter must
wait for a complaint to be filed with
him before he can act. The Attorney
General acting under the Martin law
can proceed with Investigations into
bueketing and stock frauds Of all sorts
whenever II shall appear 70 the At
torney- General. either on complaint or
otherwise" that the law Is being vio-
lated. In other words. If anything
whatsoever. information by word of
mouth. a newspaper article, or his
own observation. should cause him to
think the law was being violated, he
could act at once.
Further. the Attorncy-General is
authorized to subpoena witnesses. books
and any other information needed i'm
such an investigation with much
greater freedom from the necessity OF
granting immunity than can the Dis
trict Attorney
so anxious have been some of the
financial organizations in the financial
district to obtain some action under
that law that they have offered TO as
lst the Attorney General in any way
he might command. So far tho prose
'utions brought under that law arr
said to he negligible.