Securities Act Of 1933
What Does Securities Act Of 1933 Mean?
The Securities Act of 1933 is a federal law enacted by Congress to promote transparency in securities trading and reduce fraud and misrepresentation in the financial markets.
Insuranceopedia Explains Securities Act Of 1933
The Securities Act of 1933 requires companies dealing in securities to register with the Securities and Exchange Commission (SEC) and disclose relevant information to guide potential investors. This ensures that investors can make informed decisions before investing in a company.
The act was introduced in response to the Stock Market Crash of 1929, which triggered the Great Depression of the 1930s. Before this legislation, securities were regulated by state laws. However, the economic turmoil of the era prompted Congress to establish a federal framework for securities regulation.
