Where registration statement contained materially misleading statements
concerning, among other things, registrant's production, recoverable reserves
and operating costs, the proposed application of proceeds, and the prospects
of investors receiving any return of or income on their investment, and did not
make plainly evident the speculative features of registrant's business
and securities, held, stop order will issue suspending effectiveness of registra-
tion statement * * * Page 485

Where notice of stop order proceedings alleges that registration statement
filed with this Commission by company engaged in the acquisition and opera-
tion of oil properties is inaccurate and inadequate in its disclosures concerning,
among other things, the identity and relationship of and discounts to under-
writers, the identification of parents and controlling persons, the history,
development, and business policies of the company, the amounts at which the
properties are carried on the books of the company and the determination of
these amounts, the identification of the promoters, the description of their trans-
actions in properties subsequently sold to registrant, possible liabilities arising
under the Securities Act as a result of their transactions in the stock of regis-
trant, the depletion and depreciation charges and capital surplus and property
accounts, and the relationship of the accounting firm certifying financial state-
ments of the registrant; and where registrant waived a hearing and
post-hearing procedures and consented to the entry of stop order with the
understanding that Commission's opinion be based on such allegations, held,
stop order should issue suspending effectiveness of registration statement
Page 607

Where registration statement contained materially misleading statements
concerning, among other things, registrant's products, method of production,
competitive advantages, available market, previous sales of its securities, out-
standing options, and use of proceeds, held, stop order will issue suspending
effectiveness of registration statement * * * Page 630

Withdrawal of Registration Statement

Application for withdrawal of registration statement filed under Securities
Act of 1933, made after Commission investigation pursuant to Section 8(e)
and prior to effective date of registration statement and institution of stop
order proceedings, denied, in the public interest and for the protection of in-
vestors where registrant's affiliate having public security holders has option
to acquire substantial amount of outstanding stock in registrant from officers
of registrant who are also officers of affiliate *** Page 159

Where registration statement was materially misleading, among other things,
in representing that registrant's stock issued at incorporation was fully paid
and in failing to disclose that recited value of securities acquired by registrant
from promoters and from others was based on prices paid for such securities
in sales effected by means of misleading statements, that misleading statements
were made in prior sales of stock by registrant and by company in which
registrant had substantial investment, and that contingent liabilities to the
purchasers thereby resulted, held, under all the circumstances withdrawal of
registration statement would not be consistent with public interest and pro-
tection of investors, and stop order will issue suspending effectiveness of regis-
tration statement *** Page 202

Motion of registrant to dismiss proceedings on grounds that it has absolute
right to withdraw registration statement prior to its effective date, and that
its registration statement has been superseded by amendment filed after insti-
tution of stop order proceedings, denied, there being no right to withdrawal in
view of existence of substantial number of investors holding shares of same

class of stock covered by registration statement, and there being no valid basis for contention that amendment superseded registration statement * * * Page 202

Where registration statement is deficient in that it presents various matters in an obscure and uncoordinated manner and omits certain material information but does not contain any false statements, and deficiencies stem in large part from manner of presentation rather than concealment of facts, held, in view of the nature of the deficiencies and all other circumstances, including facts that registrant no longer plans to make a public offering and its stockholders have been given salient facts involved in principal deficiencies, withdrawal of registration statement upon issuance of Commission's findings is consistent with public interest and protection of investors and will be permitted *** Page 213

Request of issuer for withdrawal of registration statement made prior to its effective date, denied, where substantial amount of securities of issuer are outstanding in the hands of investors and in view of serious deficiencies in registration statement withdrawal would not be consistent with the public interest and the protection of investors * * * Page 226

Where registration statement contains materially false and misleading statements and omits material facts with respect to, among other things, estimates of oil reserves, use of underwriters, anticipated expenses of the offering, and use of proceeds, and where prospectus is unclear and would require reader to refer to various parts and make independent calculations and conclusions of fact in order to appraise merits of offering, and does not make plainly evident the speculative features of issuer's business and securities, held, issuer's request for withdrawal of registration statement denied and stop order issued suspending effectiveness of registration statement * ** Page 833

PART II

SECURITIES EXCHANGE ACT OF 1934

BROKER-DEALER PROCEEDINGS

Grounds for Revocation

Where registered broker-dealers, prior to the filing of registration statement with respect to contemplated offering of securities through them as underwriters, publicized such offering in a manner calculated to arouse and stimulate dealer and investor interest in the security and, by eliciting indications of interest from dealers and investors, to set in motion the process of distribution, held, publicity constituted offer to sell security in violation of Section 5(c) of Securities Act of 1933 *** Page 843

Where registered broker-dealer offered to sell securities as to which no registration statement had been filed, in violation of Section 5(c) of Securities Act of 1933; transmitted prospectuses not meeting requirements of Section 10 after registration statement had been filed, in violation of Section 5(b)(1); and made false and misleading statements of material facts in offering such securities in violation of Section 17(a), held, willful violations requiring under all the circumstances suspension of broker-dealer from membership in national securities association ** Page 882

Where registered broker-dealer, its president and sole stockholder who is also president and sole stockholder of applicant for registration as brokerdealer, and its secretary and treasurer, are permanently enjoined by decree of Court from selling securities by means of false and misleading statements, held, public interest requires revocation of broker-dealer registration and denial of application for registration *** Page 895

Where registered broker-dealer is permanently enjoined from effecting securities transactions in violation of net capital requirements, failed to comply with such requirements and to make and keep current required books and records, failed to amend application for registration to disclose employment of person subject to Court injunction, and sold securities to customers at prices not reasonably related to and substantially in excess of prevailing market prices as evidenced by registrant's contemporaneous cost, held, public interest requires revocation of broker-dealer registration, expulsion of registrant from membership in registered securities association and denial of request for withdrawal of registration *** Page 900

Where registered broker-dealer failed to consummate transactions promptly and misappropriated customers' funds and securities, and failed to comply with net capital requirements, to make and keep current required books and records, to make his books and records available for reasonable inspection, to file report of financial condition, and to correct information in registration application regarding his business address, held, in the public interest to revoke broker-dealer registration *** Page 913

Beneficial Ownership Reports

Application for confidential treatment of ownership reports filed pursuant to Section 16(a) of Securities Exchange Act of 1934, by beneficial owners of more than 10% of issuer's equity securities, denied, disclosure of such information being a fundamental objective of the Act and in the public interest, and applicants not having presented any evidence that disclosure in instant case would be contrary to general policy of the Act *** Page 190

Motion to Dismiss

Motion to dismiss broker-dealer proceedings instituted pursuant to Sections 15(b) and 15A(1) (2) of Securities Exchange Act of 1934, on grounds that order for proceedings does not state facts justifying any action against registered broker-dealer and does not state charges with sufficient particularity to enable preparation of defense, denied, where order states sufficient facts to support allegations of willful violations of statutes and rules and apprises broker-dealer of nature of the charges ✶✶✶ Page 827

Postponement of Effective Date

Where evidence presented in proceedings pursuant to Section 15(b) of Securities Exchange Act of 1934, on question whether effective date of application for registration as broker and dealer shall be postponed pending final determination of question whether such application should be denied, tends to substantiate allegations in order instituting proceeds that applicant and its president willfully made false and misleading statement in application for registration concerning ownership of stock in applicant and overstated applicant's assets in financial statement accompanying application, held, necessary in public interest and for protection of investors to postpone effective date of registration until final determination on the merits *** Page 831

Request for Bill of Particulars

Request for bill of particulars in broker-dealer proceedings instituted pursuant to Sections 15(b) and 15A (1) (2) of Securities Exchange Act of 1934 on basis of allegations that registered broker-dealer, through named officers and salesmen, made false and misleading statements concerning 18 specific matters and otherwise willfully violated anti-fraud provisions in purchase and sale of 11 named securities "among others," and failed to preserve copies of teletype messages in willful violation of record-keeping requirements, granted, with respect to the naming of any other securities that may be involved, and, denied, in all other respects since charges pertaining thereto are stated with sufficient particularity to enable preparation of defense, the items as to which particulars are sought are matters of evidence, and broker-dealer has been furnished names of witnesses to be called by staff, has been permitted to inspect pertinent records of Commission, and may apply for continuance during hearings if additional time is required to prepare defense Page 827

Public Interest

Where registered broker-dealers willfully violated Section 5(c) of Securities Act of 1933 by offering to sell security as to which no registration statement had been filed, held, under all the circumstances, including registrants' excellent reputation and fact that they acted in reliance on counsel, that no investors appear to have been injured, and registration statement as to offering has become effective, no sanction is required in public interest or for protection of investors *** Page 843

BROKER-DEALER REGISTRATION

Grounds for Revocation

Where registered broker and dealer is temporarily enjoined by state court from engaging in securities business on basis of complaint that it engaged in security transactions while insolvent, made fraudulent representations and de frauded customers, and registrant's president and controlling stockholder is permanently enjoined on basis of complaint that he engaged in acts and practices for the purpose of deceiving and defrauding the investing public, held, under all the circumstances in public interest to revoke the registrant's registration as a broker and dealer *** Page 4

Where registered broker and dealer is permanently enjoined by federal district court from engaging in the securities business while he is insolvent and his books and records are not current, from selling unregistered securities and from engaging in deceptive and fraudulent acts and practices, held, under all the circumstances in public interest to revoke registrant's registration as a broker and dealer *** Page 6

Where registered broker-dealer is enjoined, on basis of violation of Securities Act of 1933, from selling securities unless and until such securities are registered with the Securities and Exchange Commission, held, registration revoked * Page 8

Where registered broker and dealer sold securities on representation prices charged were the market prices and omitted to disclose that the market for the securities was maintained and dominated by registrant, and where registrant failed to make and keep current required books and records and failed to preserve confirmations of its transactions, held, willful violations of Sections 15(c) (1) and 17(a) of the Securities Exchange Act of 1934 and Rules X-15C1-2, X-17A-3, and X-17A4 thereunder, requiring in the public interest and for the protection of investors revocation of registration and expulsion from membership in national securities association * * Page 9

Where registered broker and dealer accepted monies and securities from customers without disclosing insolvency, made false and misleading statements in sale of securities, offered, and sold, unregistered securities, failed to comply with net capital requirements, made false statements in application for registration and failed to make and keep current required books and records, held, in the public interest to revoke registration and expel registrant from national securities association * * * Page 14

Where registered broker-dealer effected securities transactions while in violation of the net capital rule; failed to make and keep current all required books and records; bought securities while insolvent; and is permanently enjoined from engaging in the securities business unless he complies with net capital and records requirements, held, in the public interest to revoke registration and not to permit withdrawal * * * Page 30

Where registered broker-dealer failed to file annual financial report for 1955, held, willful violation of Section 17(a) of the Exchange Act and Rule X-17A-5 thereunder, and in public interest to revoke registration *** Page 33

Where registered broker and dealer repeatedly failed to make and keep current books and records in willful violation of Section 17(a) of Securities Exchange Act of 1934 and Rule 17a-3 thereunder, held, necessary in the public interest and for the protection of investors to revoke registration and expel registrant from national securities association *** Page 79

Where registered broker-dealer sold unregistered securities and is permanently enjoined from selling unregistered securities in violation of Securities Act of 1933, held, necessary in the public interest and for protection of in