CONTENTS 71 Page Armstrong, J. Sinclair, Chairman, Securities and Exchange Commis- Besse, Harry W., president, Boston Stock Exchange. Boles, Ewing T., president, Investment Dealers of Ohio, Inc.--. Coleman, Ralph P., Jr., editor, Over-the-Counter Securities Review.. Day, James E., president, Midwest Stock Exchange.. Eaton, Charles F., Jr., National Association of Investment Companies. Funston, G. Keith, president, accompanied by Edward Gray, executive vice president; Philip West, vice president in charge of stock list department; and Samuel L. Rosenberry, counsel, New York Stock McCormick, Edward T., president, American Stock Exchange.. Martin, William McChesney, Jr., Chairman, Board of Governors, 1026 Smith, Winthrop H., managing partner, Merrill Lynch, Pierce, Fenner Taylor, Tyre, general counsel, Southern States Industrial Council... Wood, Harold E., chairman of the board of governors, accompanied by George A. Newton, chairman of the legislation committee of the board of governors; Wallace H. Fulton, executive director; and John W. Lindsey, counsel, National Association of Securities Dealers, Letters, memorandums, statements, etc., submitted for the record by- Association of Casualty and Surety Companies, Ray Murphy, general 1075 1131 1134 Cole, Norman, Yonkers, N. Y.: Letter to committee.. 1235 Coleman, Ralph P., Jr., editor, Over-the-Counter Securities Review: 1218 1254 son Miley, executive vice president: Letter to Senator Fulbright 1251 Connecticut Light & Power Co., S. R. Knapp, president: Letter to Gaynor, Edwin G., Bridgeport, Conn.: Letter to Senator Fulbright. 1236 1237 Letters, memorandums, statements, etc.-Continued Page Hartford Electric Light Co., R. A. Gibson, executive vice president: 1144 Hill, Samuel, Maplewood, N. J.: Letter to Senator Fulbright-- 1236 1243 Idaho State Chamber of Commerce, Earl W. Murphy, secretary: 1252 Illinois, Office of Secretary of State, Samuel H. Young, securities com- 1255 Investment Bankers Association of America, Walter A. Schmidt, 1227 1243 Laufer, Edward E., New York, N. Y.: Letter to Senator Fulbright.. Editorial, New York Times, Over the Counter Article, Wall Street Journal, Stockholders' Right To Know 1177 1177 1242 Litchfield, Harry R., M. D., Brooklyn, N. Y.: Letter to Senator Ful- 1241 McCormick, Edward T., president, American Stock Exchange: Letter 1156 Michigan Corporation and Securities Commission, John F. Hueni, 1244 Mills, Larry, Boise Payette Lumber Co.: Letter to Representative 1255 Minnesota Department of Commerce, Theodore N. Ofstedahl, commis- 1245 Moskovitz, Max, Scranton, Pa.: Letter to Senator Fulbright with 1237 National Board of Fire Underwriters, J. Raymond Berry, general 1137 Ohio Department of Commerce, Division of Securities, Edmond H. 1256 Pirrone, Angelo, New York, N. Y.: Letter to Senator Fulbright with 1240 Pitman, B. F., Jr., San Antonio, Tex.: Letter to Senator Lehman.. 1234 1245 Rosenblatt, Martin, New York, N. Y.: Letter to committee - Definition of equity security and exempted security. STOCK MARKET STUDY (Regulation of Unlisted Securities) MONDAY, JUNE 27, 1955 UNITED STATES SENATE, COMMITTEE ON BANKING AND CURRENCY, SUBCOMMITTEE ON SECURITIES, Washington, D. C. The subcommittee met, pursuant to call, in room P-63, United States Capitol Building, at 2:30 p. m., Senator Herbert H. Lehman, chairman of the subcommittee, presiding. Present: Senators Lehman, Fulbright, and Bush. Also present: Robert A. Wallace, staff director, Banking and Currency Committee. Senator LEHMAN. Before we begin, Senator Fulbright is here. He is a member of the subcommittee, and of course he would be very welcome to testify, if he wishes to do so. Since I do not know whether he wants to today, I want to read into the record his statement on the introduction of this bill, S. 2054. Mr. President, I am introducing today a bill to amend the Securities and Exchange Act of 1934 to correct basic deficiencies in that act which were repeatedly called to the attention of the Banking and Currency Committee during its recent hearings upon the stock market. Today an investor in a company which has its stock listed and registered for trading on an exchange gets the following protections: (1) Current information about the financial condition of the company. (2) Information necessary to enable him to vote intelligently upon matters which are mentioned in proxy solicitations. (3) Information about trading by officers, directors, and large stockholders in the equity securities of the company. If these persons seek to take advantage of inside information by engaging in short-term trading, their profit may be recovered by the corporation. Investors in securities not listed on an exchange do not, save for a few minor exceptions, get these protections. No matter how large the corporation, how widely its stock is distributed, or how great the public interest in it, the disclosures I have mentioned need not be made unless the corporation has stock listed on a securities exchange. The bill I am introducing is designed to end this double standard, which has neither logical foundation nor reasonable basis. Mr. WALLACE. Mr. Chairman, I wonder if we could get a copy of the bill S. 2054 in the record and also a digest of the bill prepared by Mr. Rogers of the staff. Senator LEHMAN. If there is no objection, it is so ordered. 1023 |