john mc creery AAII Baltimore

Investor Protection
How the SEC Can Help
Jack McCreery, staff attorney
Office of Investor Education and
Assistance


The Usual Disclaimer
The Securities and Exchange Commission,
as a matter of policy, disclaims responsibility
for any private publication or statement by
any of its employees. The views expressed in
this presentation are those of Mr. McCreery
and do not necessarily reflect the views of
the SEC, its Commissioners, or other
members of the SEC’s staff.


Who We Are and What We Do
• Created in 1934 following the Stock

Market Crash of 1929
• Administer the federal securities laws
• Oversee brokerage firms and other
investment service providers
• Review filings by most public companies


How the SEC Protects Investors
• Assure that the securities markets

are open, fair, and honest
• Require companies to disclose
information
• Catch wrongdoers and impose
punishment ranging from fines to
kicking them out of the industry



How the SEC Helps Investors
Help Themselves
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Show investors how to research
investments and the people who sell
them

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Make information about publicly traded
companies available to the public

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Answer questions and handle
complaints

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Provide free educational materials

SEC Web Resources
Where can I find…
• Special collections of information, such
as updates on Enron, WorldCom
• Financial statement filings from EDGAR
• Fast answers library and our glossary
• Calculators
• Hot stock recommendations!




Who Must File Reports
A company must file reports if:
1.

It has 500 or more investors and $10
million or more in assets, or
2. It lists its securities on:
– American Stock Exchange
– Boston Stock Exchange
– Chicago Stock Exchange
– Cincinnati Stock Exchange
– International Securities Exchange
– Nasdaq Stock Market
– New York Stock Exchange
– Pacific Exchange
– Philadelphia Stock Exchange, or

3.

Its securities are quoted on the OTCBB





Tips for Searching EDGAR
• Ticker symbol search for 9400 largest
publicly traded companies
• To a find a company named for a person (e.g.,
John Doe Widget Maker, Inc.), search last
name first: Doe John
• For most searches, “Company Search” will do
For complex queries, use the “Archives” search


Sources of Company Info:
• Registration Statements (S-1, SB-1, F-1)
• Periodic Reports (Form 10-K for annual
info, Form 10-Q for quarterly results)
• Current Reports (Form 8-K)
• Proxy Statements (known in EDGAR as
Form DEF 14A)


What You’ll Find in a 10-K:
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Item 1: Business
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Item 2: Properties
Item 3: Legal proceedings
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Item 4: Submission of
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matters to a vote
Item 5: Market for securities•
Item 6: Selected financial
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data
Item 7: MD&A
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Item 7A: Market risk
Item 8: Financial statements •

Item 9: Change in accountants
Item 10: Directors &
executive officers
Item 11: Executive comp

Item 12: Ownership (insiders)
Item 13: Relationships &
related transactions
Item 14: Accounting Fees &
services
Item 15: Exhibits
Signatures & Certifications


What You’ll Find in an 8-K:
Section 1--Registrant's Business and Operations - Entry or termination of a material agreement
Section 2--Financial Information Acquisition or Disposition of Assets, Creation of a Direct Financial Obligation, Material
Impairments
Section 3--Securities and Trading Markets Notice of Delisting, Material Modification to Rights of Security Holders
Section 4--Matters Related to Accountants and Financial Statements Change of Accountants, Non-Reliance on
Previously Issued Financial Statements
Section 5--Corporate Governance and Management Changes in Control, Departure of Directors or Principal Officers
Section 6--Reserved (for future use)
Section 7--Regulation FD Disclosure
Section 8--Other Events Other Events (material, but not specified in 8-K instructions)
Section 9--Financial Statements and Exhibits Financial Statements and Exhibits
Companies have four days to file a Form 8-K for the events specified in the items in Sections 1-5 and 9 above.
However, if the issuer is furnishing a Form 8-K solely to satisfy its obligations under Regulation FD, then the due date
might be earlier.


Stock Ownership Forms
• Form 3: Insiders must file no later than the effective date
of the registration statement, or, if the issuer is already
registered, within ten days of becoming an officer, director,

or beneficial owner.
• Form 4: Changes in ownership must be reported within
two business days. Limited categories of transactions are
not subject to the two-day reporting requirement.
• Form 5: Insiders use this form to report any transactions
that should have been reported earlier on a Form 4 or were
eligible for deferred reporting.




Helpful Materials at
www.sec.gov
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On-line publications
Calculators
Check out Brokers & Advisers
Complaint Center
“Fast Answers” to securities questions