Security Litigation at its Best

1. Security Litigation at its Best The main difference between securities litigation and government litigation is that the regulation of consumer goods attempts to protect consumers from dangerous articles, misleading advertisements or illegal practising purposes. Securities laws, on the other hand attempt to ensure that investors have an informed, accurate idea of the type of interest they are purchasing and its value. Types of securities include banknotes, bonds, treasury stocks, stocks, debentures, certificates of interest or participation in profit sharing agreements, reorganization certificates or subscriptions, transferable shares, investment contracts voting trust certificates, certificates of deposit for security and a fractional undivided interest in oil and gas drilling programs. Interests in partnerships, Condominiums and Cooperatives and farm animals and land have also been bound to securities. Certain types of notes such as notes secured by a home mortgage or a note secured by accounts receivable or other businesses assets are not securities. Both federal and state law regulate securities laws .Before 1929 companies could issue stock at will. Bogus corporations sold worthless stock: other companies issued and sold large amount of stocks without considering the effect of unlimited issues on the shareholders' interests, the value of the stock and ultimately the U.S. economy. Securities are traded on markets. Some but not all markets have a physical location. The essence of a securities market is that it’s formal and informal communications systems whereby buyers and sellers make their interests known and execute transactions. Thus making them susceptible to deceptive and manipulative acts like “insider trading” To prevent such practices, all securities laws contain general anti fraud provisions.

2. The first significant federal securities law was the Securities Act of 1933, passed in the wake of the Great Stock Market Crash of 1929. As a prospective purchaser to make a reasoned decision based on reliable information, this goal was not always accomplished. And was met for example by an issuer who may have been reluctant to divulge reliable information. In 1934 the Securities Exchange Act Addressed many areas of securities law and issuers subject to certain exemptions were to register with the SEC if they have a security traded on a national exchange. Since 1964 this disclosure agreement has applied not only to companies with securities listed on the national security exchanges but also to companies with more than 500 shareholders and more than $5 million is assets Regulations of Securities Businesses Only dealers and brokers who registered with the SEC pursuant to 1934 may engage in business (other than individuals who deal only in exempted securities or business) Firms act in 3 principal capacities: rocker dealer and investment advisor The SEC has the power to revoke or suspend registration to impose censure ship it the broker dealer has violated federal securities laws or committed other specified misdeeds. For more info visit http://www.tomlinson-law.com/trade-secrets-attorney-chicago/