The Securities Exchange Act of 1934

The Securities Exchange Act of 1934 (the “1934 Act”) grants broad authority to the Securities and Exchange Commission (“SEC”) to oversee the securities industry. The SEC’s authority includes the power to register, regulate, and oversee brokerage firms, transfer agents, and clearing agencies; as well as securities self regulatory organizations (SROs), including the  Financial Industry Regulatory Authority (“FINRA”).

In addition, the New York Stock Exchange, the NASDAQ Stock Market, and the Chicago Board of Options Exchange are all subject to regulation under the 1934 Act.

Getting Funded 101

A private or public company can raise capital in a number of ways. Traditional sources of financing for companies include loans from branks or other financial institutions, receivable financing and  from friends and family. Private companies can also finance in going public transactions by selling securities in a Rule 506 Offering prior to filing a Form S-1 Registration Statement with the SEC. Going public is a milestone for any company and there are both advantages and  disadvantages of public company status. Companies going public do so because of the general perception that public company status will make it easier to raise capital.

12b-25 Question and Answer

Accelerated filers, non-accelerated filers and smaller reporting companies occasionally have difficulty meeting the Securities and Exchange Commission’s (“SEC”) reporting due dates.

Rule 12b-25 adopted by the SEC under the Securities Exchange Act of 1934, provides an extension of the SEC’s reporting due dates. This blog post contains common questions and our responses to common questions we receive about Rule 12b-25 and exensions of filing due dates of periodic reports.

Boiler Rooms Are Back in Style

Everyone who’s seen the movie “Boiler Room” is familiar with how these operations work; for once, the film makers had no need to exaggerate.  Real-life boiler rooms are run by unscrupulous con artists who hire cold callers to sell stocks and other securities to their naïve and unwary victims, using extremely high-pressure sales tactics.

The classic boiler room is run by a broker-dealer that claims to be independent, specializing in stocks chosen by their “analysts,” who, they say, have conducted extensive due diligence on the issues.  In reality, the boiler room usually colludes with company management and/or insiders.  Often they own large blocks of stock obtained at very low prices; sometimes they paid nothing at all.  They will sell into their own promotion.