Evening star., 1932-02-08
Purpose of Bowman Measure
Is to Protect Public
Against Fraud.
BUREAU OF INSURANCE
TO ADMINISTER LAW
Any One Convicted of Crime in
Investment Transactions
Would Be Barred.

Supervision and regulation of the sale
OF securities within the District of Co.
! lumbia is proposed in a bill introduced
t1day by Representative Frank L. Bow
man. Republican, of West Virginia, a
member of the House District Commit
,, tee. This measure carries the support
OF the washington group affiliated with
| the Investment Bankers Association.
Representative Bowman today ex-
planned that the purpose of this legis-
lation is to protect the investing public
In the District CT Columbia against
fraudulent practices in security trans
actions. The harm done to the victims
OF security swindles is a legitimate con-
Germ OF the Government and at the
present time the District of Columbia
lacks specific security law, Represents
atlVe Bowman emphasized
Avoids New Bureau.
This bill is so drafted as to avoid
the creation OF any new bureau. 1t
provides instead that the adninistra-
tlon OF the law shall be handled by
the present superintendent of insurance
OF the District.
The fundamental feature of the bill
is the idea that no person shall be
PERMITTED 10 remain or continue in the
securities business in the District who
has been convicted of anv criminal
oHenSeS IN connection with any trans
action involving securities or who has
peen found guilty by any court of a
violation of any securities law. either
III Ine District or in any State
rms same principle is to be applied
with equal force, Representative Bow
man pointed out, against any partner
ship, corporation or other form of busi-
ness organization whore the personnel
includes as the partner, principal officer
or office manager any person who has
Deen convicted or found guilty as above
provided
In applying this basic principle II
required that all securities dealers
and Salesmen must register their names
ana addresses with the Department of
insurance and file a statement under
oath as to their record in securities
matters. also giving their connection
during the previous five years with any
securities business.
TwO-Year Introduction.
Under the Bowman bill no person
would be allowed to be registered as
a dealer or salesman so as to entitle
him to sell securities in the District
4oI Two years dILer the Oate OF a con-
vlctlon OF any criminal ofense in con-
nection with the securities transaction.
nor Tor two years after he has been
found guilty by court of any VIOLA
tlon Of securities law regardless of
whether such conviction or finding of
guilt occurred or was made in a court
in the District or in any State
The bill provides that two or more
such convictions or two or more such
securities law violations shall consti-
tute a permanent disqualification in
the District, and under this bill no
person who has been twice so con-
victed or found guilty of a securities
law violation will be allowed at any
time to engage or continue in the Sc
curitieS business in the District.
As further protection against fraud
ulent practices. the bill gives the super
intendent of insurance wide powers to
investigate, either upon complaints or
upon his own initiative, whenever he
deems 1t necessary.