What Do These Securities Laws Cover?

The Securities Act generally requires companies to give investors full disclosure of all material facts, the facts investors would find important in making an investment decision. This Act also requires companies to file a registration statement with the SEC that includes information for investors. The SEC does not evaluate the merits of offerings, or determine if the securities offered are good investments. The SEC staff reviews registration statements and declares them effective if companies satisfy their disclosure rules. The Exchange Act requires publicly held companies to disclose information continually about their business operations, financial conditions, and managements. These companies, and in many cases their officers, directors and significant shareholders, must file periodic reports or other disclosure documents with the SEC. In some cases, the company must deliver the information directly to investors. The Investment Company Act governs activities of investment companies, such as mutual funds, that are primarily serve as collective investment vehicles for others. The Advisers Act establishes a pattern of regulating those who manage or advise others on how to invest. In some respects, it resembles the Exchange Act that governs the conduct of securities brokers and dealers, and generally requires that firms compensated for advising others about securities investment to register with the SEC and conform to statutory standards designed to protect investors.

The information on this page is meant to provide a general overview of the law. The laws in your state and/or city may deviate significantly from those described here. If you have specific questions related to your situation you should speak with a local attorney.

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