Securities Act of 1933

The Securities Act of 1933 is federal legislation that was enacted in the wake of the market crash of 1929 and remains one of the most important pieces of legislation concerning the securities industry. The legislation was designed to restore investor confidence in the market by increasing the required transparency and establishing laws against misrepresentations and other fraudelent activities in the securities market. A company that is required to register under the 1933 act must create a registration statement, which includes a prospectus, with copious information about the security, the company, the business, including audited financial statements. The company, the underwriter and other individuals signing the registration statement are strictly liable for any inaccurate statements in the document.

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