Jasper County Democrat, Volume 23, Number 40, Rensselaer, Jasper County, 14 August 1920 — OUR BLUE SKY LAW [ARTICLE]

OUR BLUE SKY LAW

G. F. Olwin, manager of the Better Business Bureau, does not seem to have much of an opinion of the blue sky law, which forms part of the record of the recent legislative session. Indeed, he makes a strong case against it. In the News ,of Saturday he pointed out that during its progress through the legislature the act was amended as to make its provisions apply only to the “issuer” who may “undertake by advertisement, circular, prospectus, through agents, or by other public or general offering to dispose of securities amenable to this law.” The words “principal or agent weie struck out, and the result is that only the “issuer,” who may live a thousand miles away, is named id the act. The man to whom stock Is issued would then be its owner, and he could sell it without violating the law—at least such is Mr.

Olwln’s belief. Whether or not thl3 is the right constructlo nos the law it certainly is somewhat significant that the words “principal or agent ' were struck out. Why this narrowing of the classification? The effect seems to be to leave the state widopen to “issuers” of “securities” who can find any one in Indiana to underwrite them. Mr. Olwin calls attention to another amendment which he says “worked havoc with the bill.” It 13 the one striking out that part of section 1 requiring the filing of copies of “all contracts or agreements between the issuer and any underwriters of such securities,’' and of all contracts relative to the

sale and disposition of sto?k, together with copies of minutes of directors or stockholders relating to or affecting the issue of such securities. What is chiefly needed in the ’ way of protection is the fullest publicity, but this is not required by the new law. “This provision,” said Mr. Olwin, “was the very meat of the bill as it passed the house and would have done more than all the rest of the bill put together to protect the public from the sale of questionable securities.” “Without,” he went on to say, “the provision requiring the filing qf copies of all contracts and minutes relative to the disposition of stock, almost any sort of deal may be put over without the knowledge of the investing public.” For most of the amendments Senator Ratts was responsible. To him Mr. Olwin presented his objections to the amended bill. He urged the house not to accept the amendments and expressed the hope that he might be permitted to testify before the” conference committee. But he was not heard, and the house yielded, believing that it was better to pass the bill and look to the next regular session of the legislature to make the necessary changes. It is strange that it should be so difficult to get legislation of this sort, in an affective form, through an Indiana legislature. —I ndianapolis News (Rep.).