The Waterbury Democrat., 1933-03-29

l today made public the following
 analysis of the proposed federal 1 securities act prepared by Huston | Thompson:
 "The federal securities act is Q
 bill to provide for the furnishing of information and the supervision | of traffic in investment securities in interstate commerce.
 Sections 1 and contain the title of the bill and certain deflni-
 tions on the following subjects:
 Security" "person," "sale," ''is- suer" commission (meaning the federal trade commission which is to have Jurisdiction under the bilD. mortgage" "title," and "in- terstate commerce"
 Section sets forth certain re. quirements in the matter of the sale and advertisement of securi- ties in interstate commerce and for bids such sale or advertisement until certain information shall have been filed with the commis- sion. This section covers the sub ject of:
 (A) The sale or offer to sell domestic securities in interstate commerce;
 (B) The advertisement of domes- tic securities through interstate medium including not only news- papers, circulars and magazines but also radio;
 co The physical transportation of domestic securities across state lines;
 (D) The sale or offer to sell by persons or corporations of the se- curities of foreign governments in the United States.
 Section provides that the pro- motors, principal officers, and di- rectors of corporations shall sign the statement except in the case of securities issued by foreign gov ernments when the statement shall be signed by persons in the United States negotiating or url- derwriting the loan for the sale in the United States.
 "Section 5 designates the infor- nation required in the statements to be filed with the commission and consists of two subdivisions (A) Information required of do- nestle corporations and (B) in-I formation required concerning for eign government securities. In the case of domestic securities it re- quires the names of the issuers of the stock. promoters. trustees. offi- cers. etc, the amount of paid up capital, the number and types of shares with the description of their respective voting rights, divi- dends, profits. the amount of fund.- ed debt, balance sheet showing a detailed list of assets and liabil- ities, a statement of the amount of the issuers' income, expense and fixed charges during the pre- ceding fiscal year; the plan of the proposed issuer, the price offered to the public, all bonuses. commis- sions and the amount returned to capital investment together with the names of all of those com-i posing the syndicate.
 Tn the case of the securities is- sued by foreign governments, the American representatives shall state the purpose. date and terms of the loan, the underwriting agreement. members of the syndi- cate, bonuses, commissions and amount to be returned to the for eign government, the security pledged with the loan and the gen. eral financial condition of the bor- rowing government and whether It has ever defaulted on principal or interest on any security sold in the United States together with the proposed method of distribution and price of the security as offered here.
 "A fee of one one hundreth of one per cent of the value of the securities will be charged for reg. istration with the commission.
 Section empowers the con- mission to revoke the registration of domestic securities. Some of the grounds are insolvency of Inc issuer, violation of the act, pre- vious or present engagements In fradulent transactions. fraudulent representation in advertising the security. #-
 Section 2 provides for judicial review In the event of an order of revocation by the commission. to the court of appeals of the dis trict of Columbia.
 Section prohibits the .nter- state advertisement either written or spoken of domestic and foreign securities subject to this a.t uf;l sss the communication contains cert tain information concerning the securities offered as required by the commission and the act. Cop- ies of all such advertising material ust be filed with the commission and the statement so filed shall be avialable for public inspection
 Section assumes that all pur-. chasers rely upon the representa-, tions contained in sthe statement and makes all the signers of such statements jointly and severally. liable to the purchasers for dama-i ges in the event of any material misrepresentation contained there