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General regulatory requirements
Wall St general regulatory requirements
The Securities Exchange Act prohibits market manipulation of security prices, with key provisions of the Act including Section 9(a) and Section 10(b). This includes;
- Creating “a false or misleading appearance of active trading in any security other than a government security, or a false or misleading appearance with respect to the market for any such security” (1)
- Engaging in a series of transactions that creates “actual or apparent active trading” has a material impact on a security’s share price “for the purpose of inducing the purchase or sale” (A)
- Knowingly spreading false information to materially impact a security’s share price (B).
The above is not an exhaustive list of the Securities Exchange Act provisions that apply to your trading activity. You’re encouraged to seek independent advice before placing orders if unsure as to whether particular conduct may breach the Act.
The Nasdaq and NYSE Exchange Rules also impose requirements on Market Participants, in maintaining fair and orderly markets, through their conduct relating to order entry and trade execution. This includes the Market Conduct Rules from Nasdaq with application to Market Participants, and the NYSE’s Conduct Rules (Rules 2010 - 7470) for Market Participants.
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