PENNY STOCK REFORM ACT OF 1990
TEMPORARY REPORTING PROVISIONS
Public Law 101-429
PENNY STOCK REFORM ACT OF 1990
429
101-429
Statute Compilation
United States House of Representatives
Office of the Legislative Counsel
text/xml
EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
GPO Statute Compilations USLM converter, version 20210527.1
2021-10-15
Penny Stock Reform Act of 1990
1881
101
1990-10-15
PENNY STOCK REFORM ACT OF 1990
[Title V of the Securities Enforcement Remedies and Penny Stock Reform Act of 1990 (P.L. 101–429), October 15, 1990, 104 Stat. 951]
[Public Law 101-429]
[References in brackets[ ] are to title 15, United States Code]
[This law has not been amended]
[Currency: This publication is a compilation of the text of Public Law 101-429. It was last amended by the public law listed in the As Amended Through note above and below at the bottom of each page of the pdf version and reflects current law through the date of the enactment of the public law listed at https://www.govinfo.gov/app/collection/comps/]
[Note: While this publication does not represent an official version of any Federal statute, substantial efforts have been made to ensure the accuracy of its contents. The official version of Federal law is found in the United States Statutes at Large and in the United States Code. The legal effect to be given to the Statutes at Large and the United States Code is established by statute (1 U.S.C. 112, 204).]
<num style="-uslm-dtd:enum" value="V">TITLE V—</num><heading style="-uslm-dtd:header">PENNY STOCK REFORM </heading>
<elided style="-uslm-dtd:omitted-text">* * * * * * *</elided>
<section style="-uslm-dtd:section" identifier="/us/sComp/101/429/tV/s504" styleType="OLC">
<num style="-uslm-dtd:enum" value="504">SEC. 504. </num><editorialNote style="-uslm-dtd:usc-reference" role="uscRef"><b>[</b>78o note<b>]</b> </editorialNote><heading style="-uslm-dtd:header">EXPANSION OF SECTION 15(b) SANCTION AUTHORITY WITH RESPECT TO PENNY STOCKS. </heading>
<subsection style="-uslm-dtd:subsection" identifier="/us/sComp/101/429/tV/s504/a" styleType="OLC">
<num style="-uslm-dtd:enum" value="a">(a) </num><content style="-uslm-dtd:text"><elided style="-uslm-dtd:omitted-text">* * *</elided></content>
</subsection>
<subsection style="-uslm-dtd:subsection" identifier="/us/sComp/101/429/tV/s504/b" styleType="OLC">
<num style="-uslm-dtd:enum" value="b">(b) </num><heading style="-uslm-dtd:header">Recommendations.—</heading><content style="-uslm-dtd:text">Within 6 months after the date of enactment of this Act, the Securities and Exchange Commission shall submit to each House of the Congress such recommendations as the Commission considers appropriate with respect to further revision of section 15(b)(6) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b)(6)). In preparing such recommendations, the Commission shall consider the desirability and effect of expanding the applicability of such section to any promoter, finder, consultant, agent or other person who engages in activities with a broker, dealer, or issuer for purposes of the issuance of or trading in, or inducing or attempting to induce the purchase or sale of, any security (and not just penny stock).</content>
<elided style="-uslm-dtd:omitted-text">* * * * * * *</elided>
</subsection>
</section>
<section style="-uslm-dtd:section" identifier="/us/sComp/101/429/tV/s510" styleType="OLC">
<num style="-uslm-dtd:enum" value="510">SEC. 510. </num><editorialNote style="-uslm-dtd:usc-reference" role="uscRef"><b>[</b>78s note<b>]</b> </editorialNote><heading style="-uslm-dtd:header">REVIEW OF REGULATORY STRUCTURES AND PROCEDURES. </heading>
<subsection style="-uslm-dtd:subsection" identifier="/us/sComp/101/429/tV/s510/a" styleType="OLC">
<num style="-uslm-dtd:enum" value="a">(a) </num><heading style="-uslm-dtd:header">Review Required.—</heading><chapeau style="-uslm-dtd:text">The Comptroller General, in consultation with the Securities and Exchange Commission, shall conduct a review of the rules, procedures, facilities, and oversight and enforcement activities of self-regulatory organizations under the Securities Exchange Act of 1934 with respect to penny stocks (within the meaning of section 3(a)(51) of such Act). Such review shall include an analysis of—</chapeau>
<paragraph style="-uslm-dtd:paragraph" identifier="/us/sComp/101/429/tV/s510/a/1" styleType="OLC">
<num style="-uslm-dtd:enum" value="1">(1) </num><content style="-uslm-dtd:text">the resources devoted by self-regulatory organizations to the detection, investigation, prosecution, and correction of fraud and abuse in the trading of such penny stocks;</content>
</paragraph>
<paragraph style="-uslm-dtd:paragraph" identifier="/us/sComp/101/429/tV/s510/a/2" styleType="OLC">
<num style="-uslm-dtd:enum" value="2">(2) </num><content style="-uslm-dtd:text">the methods and techniques used, and alternative methods which may be used, in those oversight and enforcement activities, including methods and techniques involving coordinated oversight and enforcement activities with other Federal and State authorities;</content>
</paragraph>
<paragraph style="-uslm-dtd:paragraph" identifier="/us/sComp/101/429/tV/s510/a/3" styleType="OLC">
<num style="-uslm-dtd:enum" value="3">(3) </num><content style="-uslm-dtd:text">the adequacy of the rules, procedures, and facilities of such self-regulatory organizations for the prevention of excessive spreads and markups, unscrupulous sales practices, and other conduct inconsistent with high standards of commercial honor and just and equitable principles of trade;</content>
</paragraph>
<paragraph style="-uslm-dtd:paragraph" identifier="/us/sComp/101/429/tV/s510/a/4" styleType="OLC">
<num style="-uslm-dtd:enum" value="4">(4) </num><content style="-uslm-dtd:text">any obstacles to or limitations on the authority of self-regulatory organizations that impair the conduct of those oversight and enforcement activities;</content>
</paragraph>
<paragraph style="-uslm-dtd:paragraph" identifier="/us/sComp/101/429/tV/s510/a/5" styleType="OLC">
<num style="-uslm-dtd:enum" value="5">(5) </num><content style="-uslm-dtd:text">the adequacy of current listing and maintenance requirements and procedures and the potential for erosion of such requirements and procedures due to issuer avoidance of penny stock designation and regulation; and</content>
</paragraph>
<paragraph style="-uslm-dtd:paragraph" identifier="/us/sComp/101/429/tV/s510/a/6" styleType="OLC">
<num style="-uslm-dtd:enum" value="6">(6) </num><content style="-uslm-dtd:text">such other matters as the Comptroller General considers necessary or appropriate.</content>
</paragraph>
</subsection>
<subsection style="-uslm-dtd:subsection" identifier="/us/sComp/101/429/tV/s510/b" styleType="OLC">
<num style="-uslm-dtd:enum" value="b">(b) </num><heading style="-uslm-dtd:header">Report.—</heading><content style="-uslm-dtd:text">Within one year after the date of enactment of this Act, the Comptroller General shall submit a report on the review required by subsection (a). Such report shall include, in addition to a statement of findings with respect to each matter described in paragraphs (1) through (6) of such subsection, such recommendations as the Comptroller General considers appropriate with respect to legislative or administrative changes.</content>
</subsection>
</section>