Evening star., 1934-05-05
House Completes Action
on Rayburn Measure,
Passed 280-84.
SENATE SECURITIES ACT
REVISION TO BE SOUGHT
Fletcher Says Recommendations
for Amendments Will Meet
Some of Objections,
By the Associated Press

A swift Senate-HOuse compromise
on stock market control appeared
likely today.
AS the House completed action yes
terday with a 28O-to-84 passage Of
the Rayburn exchange regulation
measure. democratic leaders advanced
steps for revision Of the Senate Sc
curities act next week at the same
time the House measure comes up for
action.
In proposing a series Of amend
ments to the securities act, criticized
by business and industry as interfer-
ing with their financing operations,
Chairman Fletcher Of the Senate
Banking Committee contended they
will not emasCulate or destroy the
purpose of the securities act. but Will
meet some Of the objections raised
against it."
The amendments would lessen the
concededly severe liabilities imposed
on officers, directors and underwriters
in connection with the issuance of
securities and would limit somewhat
the recovery Of damages under Ger
tain conditions.
Differs From Rayburn Bill.
Few changes in the existing form Of
the Fletcher stock market bill were
anticipated in the Senate. The Sen
ate bill differs in two important par
ticulars from the Rayburn measure,
which went Unscathed through the
House with the exception of a few
clarifying committee amendments.
When the differing measures get
into conference, there were definite
indications today the Senate would
accept the House provision setting
a IS per cent margin as a guide to
the Federal Reserve Board. In re-
turn it was indicated the House would
approve the Senate'S proposal for
a separate commission Of five to ad-
minister both the exchange and
securities acts rather than leave them
with the Federal Trade Commission.
The Senate bill leaves the fixing
Of margins entirely up to the Reserve
Board, whsle the House yesterday de-
fested. 284 to "a. the Bulwinkle
amendment to set up a stock ex-
change commission of three. 1t was
the last big test on the administra-
ton measure. and the Democratic
majority, whipped into line by Chair
man Rayburn, Democrat, Of the
Commerce Committee beat it down
as it did all other so-called amend
ments that Rayburn termed weak
ening"
Rayburn Denies Charges.
-Four days of House discussion
brought repeated references to the
men surrounding the President" Re-
publican attacks on the brain trust"
and repeated Republican assertions
that the measure was intended to put
the Government in control not only
Of the stock exchange, but Of all
business
Rayburn, backed by several of his
Republican Committee colleagues. de-
MED such charges in toto. averred the
bill was not written by brain trust
erS," and declared it in its final draft
was their own handiwork.
The measure would:
Require registration of all stock ex-
changes with the Federal Trade Com
mission.
Empower the Federal Reserve Board
to fix minimum margin requirements
for brokerage accounts and loans on
securities by Reserve member banks.
Declare it the opinion of Congress
that the margin minimum normally
should be rs per cent.
Prohibit "manipulative devices" in
Guiding pools and other practices in
tended to create artificial securities
prices.
Give the trade commission power to
regulate, or abolish short sales and
options.
Give the commission power to open
specialists books to public inspection.
Direct the commission to study the
feasibility of prohibiting floor trading
and the enforcement of the functions
of broker. dealer and specialist.
Report Requirement.
Require annual and quarterly re-
ports by corporations with listed stocks
showing earnings, sales and other in
1OrmatlOn OF value TO It's STOCKHOLDERS.
Give the Trade Commission power to
pass upon new issues of securities be-
fore they could be listed.
Provide civil redress for persons buy
ing or selling stocks as the result of
wilfully misleading advice, with the
burden of proof placed upon the de-
fendant to show good faith.
Impose minimum penalties of two
years and $4,000 for violations of the
act or of regulations issued under it for
individuals and S500,000 fine for ex-
changes.
The essential differences between the
House and Senate measures lie in the
latter'S StipulationS that:
The bill will be administered by a
specially created commission of five
members. to be appointed by the
President, except that, like the House
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