State Securities Regulators Mark 100 Years of Investor Protection

Mar 10

State securities regulators throughout the United States are marking the 100th anniversary of the nation's first state securities law, which went into effect in Kansas on March 10, 1911. Texas enacted its first securities statute in 1913.

"For 100 years, state securities regulators have served on the front lines of investor protection to ensure a level playing field and a fair deal for all,"said Benette L. Zivley, Texas Securities Commissioner. "The State Securities Board's employees are proud to continue building on the century-old foundation of putting crooks running investment scams behind bars, returning lost money to investors and teaching fellow Texans to spot and report the red flags of investment fraud."

The State Securities Board regulates the securities industry in Texas. The Agency registers securities offered or sold in Texas, oversees the firms and individuals selling securities or providing investment advice to Texans, enforces the Securities Act through criminal, civil, and administrative actions, and provides investor education resources and programs.

"State securities regulators work hard to protect those 'Main Street' investors who may lack the expertise, experience and resources to adequately protect their own interests,"Zivley said.

As the regulators closest to investors, state securities regulators are often first to receive investor complaints, allowing state investigators to identify and stop emerging frauds, prevent harm to other investors, recover stolen funds, and penalize the scam artists.

Texas' 1913 "Blue Sky"securities law was limited in scope and it wasn't until 1923 until a more comprehensive law was passed, largely in response to a spate of troublesome oil-company securities that had been issued in 1918-1919. (The term "Blue Sky"originated in Kansas, where fly-by-night promoters were described as offering investments worth no more than "so many feet of blue sky.")

A century after the first Blue Sky laws, reforms are taking shape at the national level to give new authority to state securities regulators to help protect 21st century investors. "State securities regulators remain dedicated to standing up for the interests of investors as we enter the next century of investor protection,"Zivley said.

The centennial of state securities regulation will be celebrated in Wichita, Kan., at the annual conference of the North American Securities Administrators Association on Sept. 11-13.