What was the ‘Securities Act Of 1933′
The Securities Act of 1933 was established as a result of the stock market crash of 1929. The
legislation had two main goals: to ensure more transparency in financial statements so investors
can make informed decisions about investments; and to establish laws against
misrepresentation and fraudulent activities in the securities markets.
BREAKING DOWN ‘Securities Act Of 1933′
The Securities Act of 1933 was the first major legislation regarding the sale of securities. Prior to
this legislation, the sales of securities were primarily governed by state laws. The legislation
addressed the need for better disclosure by requiring companies to register with the Securities
and Exchange Commission. Registration ensures companies provide the SEC and potential
investors with all relevant information by means of the prospectus and registration statement.
Main Objectives of Securities Act of 1933
The Securities Act of 1933 required that investors receive financial information from securities
being offered for public sale. This means that prior to going public, companies had to submit
information made readily available to investors. This prospectus is required and available on the
Securities and Exchange Commission website. Information required includes a description of
the company’s properties and business; a description of the security being offered; information
