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Business Law Newsletters

An Introduction to the Securities Exchange Act of 1934

In response to the stock market crash of 1929, Congress enacted the Securities Act of 1933 and the Securities Exchange Act of 1934. While the Securities Act governed the issuance of securities, the Securities Exchange Act regulated trading in the securities.

Criminal Liability of Corporate Officers

Under Section 807 of The Sarbanes-Oxley Act of 2002 (Act),1 any person who knowingly commits securities fraud is subject to a hefty fine, a prison term of up to 25 years, or both. Section 807 does not criminalize securities laws violations for the first time; however, it does combine several existing laws so as to facilitate and streamline federal prosecutions. Section 807 does impose significantly harsher criminal penalties than the penalties prescribed under prior laws.

Fairness Standard and Business Judgment Rule


Securities Law

(An Outline of Federal Securities Laws)

Significance of Par Value of a Stock

Common stock and other securities may be issued with or without a stated face value or "par" value. Issuing stock with or without par or face value may have several consequences.