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Business Regulation

Essay by   •  August 18, 2012  •  Research Paper  •  605 Words (3 Pages)  •  1,588 Views

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Business Regulation

Business Law

Government Regulation is needed in the U.S. to keep scandals from ruining our businesses livelihood and the financial futures of all Americans.

Introduction

Many acts have been created because of controversy and scandals that have and continue to happen in the U.S. These acts were introduced to prevent individuals and businesses from losing everything and to help the government to keep individuals and businesses safe from scams. Without these regulations there would be no standards and companies and corporations could do as they please. They also help to monitor the accounting of companies, keep the scandals at a minimum, and watch for trends so we don't have another stock market crash. Too many people have lost everything when these types of disasters strike.

Securities Acts of 1933 and 1934

The Securities Act of 1933 was enacted as a result of the stock market crash of 1929. It was the first major piece of federal legislation to apply to the sale of securities. The legislation was enacted as the need for more information within and about the securities markets was acknowledged. The 1933 Act was based on the idea that companies offering securities should provide potential investors with sufficient information about both the issuer and the securities to make an informed investment decision. The Securities Act of 1934 established the Securities and Exchange Commission (SEC). The 1934 Act also gives the SEC power to police the sale of securities in the U.S. This law prevents fraudulent activities of any kind. They deal with things, such as, insider trading, tender offers, and corporate reporting.

Related Fraud/Scandal

1. Charles Schwab Investment Management

2. Charles Schwab & Co.

The Foreign Corrupt Practices Act of 1977

The Foreign Corrupt Practices Act of 1977 was enacted for the purpose of making it unlawful for certain classes of persons and entities to make payments to foreign government officials to assist in obtaining or retaining business. It makes companies keep books and records that accurately and fairly reflect the transactions of the corporation and devise and maintain an adequate system of internal accounting controls. In the 1970's there were many companies that admitted to making questionable payments to foreign government officials. This is unacceptable.

Related Fraud/Scandal

1. Lockheed

2. Benagate in which Chiquita

3. Watergate

Sarbanes Oxley Act

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