New Britain herald., 1929-05-04

State Capitol, Hartford. May N What is called by legislators and political experts the biggest piece ol legislation passed by the 1929 gen. eral assembly, relates to dealing in stocks and bonds and the promotion of new concerns.
 This piece of legislation is the states new fraud act, similar and yet different from the "blue sky laws of other states.
 Bank Commissioner Lester E. Shippec says the state never had what really could be designated as blue sky law" though it has pre- viously supervised and regulated through his department the promo ton of mining and oil securities. Wishing to have on the books of the state a law similar to those in effect in other states but of less strin- gent nature, the legislators decided to put through what is now called the fraud act"
 It gives the bank commissioner power. when he suspects illegality or fraudulent intent, to subpoena witnesses, examine books, apply for injunctions, and take other such steps as will stop or bring to justice wrongd oers. Unlike the blue sky law" of other states the fraud of does not give the state power through it's bank commissioner to pass on stocks and bonds or license those who sell or promote them. It merely makes possible the commis- sioner's proceeding against those who defraud investors.
 Mir. Shippee believes the fraud act has sufficient teeth in it to deter illegal or fraudulent promotions and to protect the public. In the event it proves it has not enough teeth. he can apply to other legislators, for more.
 To help banks and trust compan- ies expand, and make further pro- sress, the legislature enacted a measure enabling these institutions to reduce their par values to $25 on approval of the commissioner. New companies may not capitalize at less than $50 share but when they are going concerns" they may apply | for reduction to the minimum, New Fiductary Act
 The fiduclary act is another new creature of the present legislature Formerly the general assembly granted special trust powers to cor prations. but the present body ceas- cd doing so. Under the new act | fiduciary corporations are incorpor- ated with trust powers as specially chartered corporations and are made subject to supervision and regulation of the bank commissioner, A com- panion act gives the commissioner regulatory and supervisory power over mortgage companies go far as their trust operations are concerned Abuse of trust power was the chiei ! reason for the fiduciary act. accord ing to MT. Shippee.
 l Several measures enacted extend the investment powers of savings banks by legaliziEg certain bank l stocks in this state, fin Boston. New York. and Philadelphia and allow ownership of stocks in affiliated or subsidiary companies, which was H. | legal before. Under this heading is all act allowing savings banks to hold stocks in certain gas companies Still another act allows these banks to increase loans on joint and sev. eral obligations from five to ten pei cent of their deposits and surplus. Rank Books as Security Of interest perhaps to the genera public more than any other savings bank act was that which allows hold "rs of passbooks in savings bank iu New York, Massachusetts. and Rhode Island to borrow money from