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Re: Securities professionals have a lot of catch phrases. Wha...
Chapman, Spira & Carson - Disscusion

From: North American Securities Administrators Association, NASAA
Date: 4/17/99
Time: 8:43:35 AM
Remote User:


Each State in the United States has a Securities Commissioner. In addition each state has its own securities regulations apart from the Federal Government. These are called "Blue Sky" laws and the term refers to transparency and disclosure. The Bluer the sky the more and further you can see. Thus, the state's Blue Sky Laws refer to how much disclosure is required from an issuer. These commissioners are also responsible for enforcing intrastate securities violations. The association is very concerned with Microcap Fraud as well as any other type of securities violation. This piece is to get you familiar with the operation of this organization.

NASAA Fall 1998 Newsletter - Front Page The oldest international organization devoted to investor protection, the North American Securities Administrators Association, Inc. (NASAA) was organized in 1919. It is a voluntary association with a membership consisting of the 65 state, provincial, and territorial securities administrators in the 50 states, the District of Columbia, Canada, Mexico, and Puerto Rico. In the United States, NASAA is the voice of the 50 state securities agencies responsible for grass-roots investor protection and efficient capital formation.

INSIDE THIS ISSUE Message from the President

Legislative Update

News from Canada

Media/Public Relations

Investor Education

Inside NASAA



Fall 1997

Spring 1997 WORKING TOGETHER: Regulators Cooperate to Protect Investors "The bull market on Wall Street has helped create a bull market in fraud on Main Street," according to NASAA President Denise Voigt Crawford. "The sad fact is that con artists are coming out of the woodwork to fleece investors," she said in early August at a joint news conference with regulators from the Federal Trade Commission and the Securities and Exchange Commission.

At that news briefing, NASAA and the two federal agencies announced a series of enforcement actions against nearly 60 companies and individuals promoting unregistered, deceptive or fraudulent investments in entertainment related areas such as movies, television and cable programming, infomercials, Internet gambling and theme restaurants.

This coordinated action is a prime example of how regulators can work together to leverage their resources. By pooling their actions, regulators can create a bigger media splash. The entertainment sweep, for example, attracted more than 14 television camera crews, believed to be a record for a press conference at the FTC. It also drew reporters from major newspapers such as the Wall Street Journal, the Financial Times, the Los Angeles Times, the New York Times, the Washington Post and Barron’s.

Just as important, however, by working together, regulators can do a better job protecting investors from fraud. One example: late last year the regulatory arm of the National Association of Securities Dealers (NASDR) shared information its investigators had accumulated on Monroe Parker, a New York brokerage firm specializing in microcap stocks, with the New York Attorney General’s Office, which was already investigating Monroe Parker.

That additional information helped New York regulators to build their case, which resulted in the arrests, in early May, of the firm’s owners and top executives. Says Assistant Attorney General Andrew Kandel: "This is just one of several examples of cooperation between the NASDR and state regulators. I definitely see this as the beginning of a very positive trend."

Conferences and training seminars allow regulators to meet with their state, national or federal counterparts, to share information, brainstorm and plan effective coordinated actions. A good example was a joint training on "microcap" stock fraud held in early June in Ft. Lauderdale, Fla., by NASAA, the SEC, NASDR, the New York Stock Exchange and the American Stock Exchange.

More than 150 enforcement and examination staff, from the states, self-regulatory organizations and the SEC, listened to presentations on the microcap fraud problem. They conducted mock examinations and interviews of microcap brokerage firms. They learned about on-line resources as well as how the Internet is being used—and abused—by con artists.

Demonstrating the importance of this kind of training, the three day microcap session and a subsequent NASAA-SEC broker-dealer training was attended by NASAA’s President Denise Voigt Crawford, NASD Regulation President Mary Schapiro and Lori Richards, Director of the SEC’s Office of Compliance Inspections and Examinations.

NASDR’s Schapiro told the broker-dealer meeting, also held in Ft. Lauderdale: "Networking is a hackneyed phrase, but I guarantee you will need each other over the coming months or years and being able to put a face with a name will be invaluable. Working together (as securities regulators) we can be a powerful force in ensuring fair-dealing and market and operational integrity."

"To cope with the growing amount of fraud in the marketplace," says NASAA’s Crawford, "we regulators need to worker harder, smarter and more efficiently. We can only do that if we make it a priority to work together."

Last changed: March 17, 2000