Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-04-03
Believe Measure Better Than
Proposal of Senator Blaine
on Securities.
ADMINISTRATION PLAN
BASIS FOR OPPOSITION
Commissioners Against Proposal to
Submit Financial Paper for
Official Approval.

The District Commissioners came out
today in favor of the Capper plan for
regulating the sale of stocks and bonds
in Washington and against the Blaine
bill, which would place the sale of Sc
curities under the regulation of the
Public Utilities Commission
In reporting to the Senate District
committee today, the city heads ex-
pressed the belief that there is need
for better regulation of securities. and
feel that Senator Capper's bill will &C
compliSh the desired result with one
minor amendment.
The chief objections the Commits
sionerS see in the Blaine bill are that
1t would place the Government in the
position of having approved securities
offered for sale, and that it also would
lead to delay and expense in handling
sound securities.
The Capper bill would provide for the
registration of dealers and statesmen
engaged in the sale of securities and
requirement that they give a bond
when they obtain a license The amend
ment suggested by the Commissioners
would authorize the necessary appro-
priation for the employment of per-
sonnet to carry out the regulation. Re-
ferring TO the Capper bill, the report
said:
See Need for Law.
"The Commissioners believe there is
necessity for passage of legislation
regulating the sale of securities in the
District. Existing laws under which
prosecutions are brought for the sale of
fraudulent securities are not adequate
to meet the situation. This bill has
received careful scrutiny of the corpora
ton counsel, and it is believed will ac-
complish the desired result, If amended
as recommended"
In going on record against the other
measure. the Commissioners reported as
follows:
The fundamental difference between
the two measures is that S-l332 (Capper
bid does not require the submission of
securities for official approval before
they are offered to the public, whereas,
Senate 3491 (the Blaine bill), does re-
quire such approval. The Commission
ers feel that the practice of officially ap-
proving securities under this bill would
convey a substantial approval by the
Government that the securities offered
represented substantial value and merit.
They believe that the practical effect
OF this bill would be to create difficulties,
delay and expense in connection with
the distribution of sound securities.
These objections would not apply to
Senate 1882. They believe that the
latter bill provides a better and more
effective method in preventing fraud and
misrepresentation. They further believe
that taking into account local conditions
IN the District of Columbia, Senate 1882.
II enacted, would prove an adequate and
eHectlVe measure Of protection.
Limited to Compact City.
"They would invite attention to the
fact that in the case of the District of
Columbia Congress is dealing, not with
large area and scattered population,
but simply with one compact city.
where conditions are favorable for
making the administration of a law
such as is proposed by Senate 1892,
simple, direct and positive.
"A further objection to Senate 349t
IS that it places the administration of
the proposed law under the Public
Utilities Commission, instead of the
Commissioners. The Public Utilities
Commission is especially charged with
the supervision of public service COM
panies, and its administrative work
has no relation to such functions as
the administration of a securities act
would involve. The Commissioners be-
lieve 1t unwise to place a securities
law under the utilities commission"