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and this refers to the laws of the States on the subject of corporations, as they have been written for the last 25 or 30 years: The race was one not of diligence but of laxity.

That quotation is from Judge Brandeis' dissenting opinion, which pretty nearly describes what has happened in the field of corporation law, as showing how the States had competed for charter fees, just as some of them seem to be competing nowadays for divorce cases.

He said that the race was not one of diligence, but of laxity. Mr. LEA. Judge, do you think that it is desirable for the Commission to be given authority to insist upon more details, more accurate registration statements, before those statements are permitted to be filed and given to the public?

Mr. HEALY. I think that would be a very excellent provision. I would say that it would.

Mr. LEA. This bill, as I understand, gives the Commission no authority to provide that the statements shall be more accurate before being filed.

Mr. HEALY. Of course, the Commission will make rules and regulations, and prescribe forms that will be used which will meet that situation to a certain extent, but to fully meet the situation such a provision as you describe, ought to be inserted in this bill, in my opinion.

Mr. LEA. Now, as I understand the act, any prospective buyer would have the right to write to the Commission and get certain information.

Mr. HEALY. Yes.
Mr. LEA. About offered securities.
Mr. HEALY. Yes, sir.

Mr. LEA. Will the Commission give those wanting facts, all of the facts, or will it simply transmit copies of the statements given by the issuers?

Mr. Healy. Under my interpretation of this act, the Commission would not be at liberty to interpret the statements or give the inquirer any advice.

Mr. LEA. Do you think that it is desirable to limit the Commission's authority to any extent?

Mr. HEALY. I wish that there was some way that could be devised that would be safe for everybody, and permit the Commission a little leeway in that respect, but I do not know whether it could be written into the law or not, without raising the possibility of grave abuses.

The CHAIRMAN. That will conclude our hearings.

Mr. SADOWSKI. Would that come under an amendment to section 15 (a)?

Mr. LEA. I do not think that that is the section; but details might be given if there is any way in which we can reach them.

Judge, would you mind expressing an opinion as to section 14, which gives each State dominating control over interstate commerc within the State?

Mr. HEALY. I would be reluctant to answer that question, but, since you have put it to me, I must make an honest answer, and in making it, I regret to have to find myself somewhat in disagreement with the authors of the bill.

I think I cannot express my views without paraphrasing tinse you have already expressed. I think that this is, in a degree, a surrender of Congress's control over interstate commerce, and I think it would make

the administration of the act a very difficult thing. I do not understand and I do not fully see how the Commission could become expert in the laws of all of the 48 States. They are not consistent, they conflict in many respects, and I am afraid, I am afraid of that provision. I am afraid of the workability of it.

Mr. LEA. That is all. The CHAIRMAN. We are very much obliged to you, Judge, and tu all of you gentlemen.

Mr. BREED. Yesterday, you asked me if I could furnish you with copies of the Martin Fraud Act.

The CHAIRMAN. Yes.
Mr. BREED. And we have received them.
The CHAIRMAN. They have come?
Mr. BREED. They are here, and I will distribute them.

The CHAIRMAN. Tomorrow, at 10 o'clock, the committee will meet the drafting service, and at that time we will determine upon the policy of how far we will go, and how far we want to go; if we go as far as this bill goes, or some of the sections, and we want to determine those policies tomorrow, in connection with the drafting service, and then the drafting service can draw the bill.

I am having the amendments to the bill submitted by Mr. Thompson this morning copied, and they will be ready for every member of the committee, either late this afternoon or early in the morning.

Also, some other matters have come into my hands today that I think will be of benefit to us in consideraing the bill in executive session.

We will meet at 10 o'clock, tomorrow morning. Mr. Thompson, we are very much obliged to you. (Mr. Marland submitted the following telegram for the record :)

OKLAHOMA City, OKLA., April 5, 1933. don. E. W. MARLAND,

Member of Congress, House of Representatives. Your consideration requested in re amending section 11 of Federal Securities Acts 875 to provide “any security issued by building and loan associations operating under laws and subject to examination, supervision, and control of any State." The building and loans of Oklahoma have 36,000 stockholders and investors residing outside of State; their total investments amount to $28,000,000. Such investments corresponds to that of deposits in savings bank. These out of State investors constantly receive literature, reports, and statements from State building and loans. Fifty percent of these out of State investors make monthly remittances. Believe expense and inconvenience to building and loans unnecessary and unwarranted and that type of stock or shares exceedingly different from those sought to be controlled. Regards,

John B. DOOLIN, Chairman Oklahoma State Building and Loan Board.

John F. MAHR, Executive Secretary Oklahoma Building and Loan League. (Thereupon, at 1:20 p.m., the hearings on H.R. 4314 were concluded.)

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