Imágenes de páginas

The staff of the Commission is now engaged in an evaluation of the conclusions and comments contained in the Wharton School Study, in a study of the structure of the investment company industry generally, and in a reassessment of the provisions of the Investment Company Act and the Commission's rules and regulations thereunder. This detailed analysis, together with related Commission studies now in progress, will aid the Commission in determining whether specific legislative recommendations should be made to the Congress with respect to the Act and what action, if any, should be taken to strengthen the rules and regulations under the Act. Registration of New Security Offerings

Although the number of registration statements filed under the Securities Act of 1933 with respect to securities issues proposed to be publicly offered dropped off as a result of the market decline toward the end of the fiscal year, the total number of statements filed during the year, 2,307, far exceeded that for any previous year in the Commission's history. This figure represents an increase of 26 per cent over the record number of statements filed in the preceding year. The dollar amount represented by these statements aggregated $21.6 billion, or 4.4 per cent more than the corresponding figure for the previous year. During fiscal year 1962, 1,815 statements relating to offerings of $19.5 billion of securities became effective, also a record both in number and dollar amount, as graphically shown in the chart on page 5.

The unprecedented number of registration statements filed placed a heavy burden upon the Commission's staff. Aside from the sheer volume of statements, a record number of 1,377 statements representing 60 percent of all those filed, related to companies that had not previously been subject to the registration process. The examination of such statements tends of necessity to be more time-consuming than that of filings by issuers which have previously gone through the registration process.

In an effort to reduce the record backlog of registration statements on file, the staff of the Commission was forced to work frequently on an over-time basis and the Commission effected a number of changes in processing procedures during the fiscal year. Among other things, it was decided to reduce the amount and layers of review, particularly with respect to statements relating to high grade debt securities and those filed by public utility companies, by established companies which have filed financial information with the Commission within recent periods, and by other established companies where the registration statement is meticulously prepared and the financial statements are unexceptionable. The Commission also took steps to dispose of a

[merged small][merged small][graphic][subsumed][subsumed][subsumed][subsumed][merged small][subsumed][subsumed][subsumed][subsumed][subsumed][merged small][merged small][merged small][merged small][merged small]

(Fiscal Years)

DS. 41261

large group of statements which had been unsatisfactorily prepared, and had been on the docket for a long time without any corrective amendments having been filed. Enforcement Activity

During the fiscal year, fraudulent sales of securities and other illegal practices in connection with securities transactions presented, as in past years, a major problem for the Commission and occupied the time of a large portion of its staff. As described in more detail in subsequent portions of this report, the Commission continued to pursue a vigorous enforcement program. Thus, it referred 64 cases to the Department of Justice for criminal prosecution during the year, constituting the largest number of referrals in a single year in the Commission's history, and brought 89 injunction actions. In addition, a total of 503 investigations of securities transactions involving pos

sible violations of the antifraud or other provisions of the securities acts were instituted, and 51 orders suspending the exemption from registration provided for small security issues were issued. Delegation of Functions

The enactment in August 1962 of Public Law 87–592, authorizing the Commission to delegate to staff members certain of its functions, should have the effect of strengthening the Commission's administration of the various acts administered by it. When implemented, the proposed delegation will relieve the Commissioners from certain routine matters with which they now deal and free them to devote more attention to major matters of policy and planning.

In December 1962, following extensive work by the Commission and at the staff level with a view to implementation of the law, the Commission published notice that it had under consideration the adoption of rules which would accomplish delegation of various routine functions to certain of its staff officials, including Division and Office heads and regional administrators, to be performed by them or under their direction by such persons as might be designated from time to time by the Chairman.

LEGISLATIVE ACTIVITIES Early in the fiscal year, the Congress passed and the President signed Public Law 87-196, which directed the Commission to make a study and investigation of the adequacy of the rules of national securities exchanges and national securities associations. Subsequently, Public Law 87–561 extended, from January 3, 1963 to April 3, 1963, the date by which the Commission is required to report to the Congress the results of its study and investigation, together with its recommendations.

Because of the extensive study of the securities markets which is still in progress under these laws, the Commission did not recommend any legislative program of its own during the Second Session of the 87th Congress. Several items of legislation suggested by the Commission in recent years which have not as yet been enacted may now be merged in broader legislative recommendations growing out of the Market Study, and it was thought best not to make any piecemeal recommendations during the pendency of the Study. It is unlikely that the Commission will make substantial legislative proposals prior to the completion of the Study in April 1963, unless the results of portions of the Study should suggest certain legislative changes or additions which might lend themselves to separate treatment in advance of completion of the entire Study.

Apart from the authorization of the Special Study and the extension of time for its completion, the legislation enacted during this past year which has the most direct effect upon the work of the Commission is S. 2135 which became Public Law 87–592 subsequent to the close of the fiscal year. This law is the legislative version of Reorganization Plan No. 1 which was disapproved at the First Session of the 87th Congress.

Prior to the adoption of S. 2135 by the Senate on September 1, 1961, the Commission submitted comments on the bill, recommending its adoption subject to certain suggested amendments. After its adoption by the Senate with amendments suggested by the Commission, a memorandum of comment was submitted by the Commission to the House Committee on Interstate and Foreign Commerce and

See the Commission's 27th Annual Report, p. 8, for a discussion of H. J. Res. 138, which, as modified, became Public Law 87-196.

Chairman Cary appeared before that Committee in support of the bill.

In essence, Public Law 87–592 expressly permits the Commission to delegate to one or more members of the Commission or to its staff certain functions which were previously performed by the full Commission. The statute requires the Commission to retain a discretionary right to review delegated action within a time and in a manner to be prescribed by rule, although in certain situations a person or party adversely affected by delegated action is entitled to review by the Commission as a matter of right. In addition, it provides that the vote of one Commissioner shall be sufficient to bring any delegated action before the Commission for review, and that delegated action shall become the action of the Commission for all purposes, including review by the appellate courts if no Commission review of the delegated action is sought within the time specified by rule, or if the Commission declines review.

A substantial amount of time was devoted during the fiscal year to matters pertaining to legislative proposals referred to the Commission for comment and to Congressional inquiries. A total of 47 legislative proposals was analyzed, and numerous Congressional inquiries relating to matters other than specific legislative proposals were reviewed and answered.

« AnteriorContinuar »