Samuel B. Franklin & Company v. Securities and Exchange Commission

Samuel B. Franklin & Co., herein called the petitioner, seeks review of an order of the Securities and Exchange Commission. That order affirmed disciplinary action taken by the National Association of Securities Dealers, Inc., imposing upon Franklin a censure, a fine of $1,000 and costs of $773.80.

Section 15A of the Securities and Exchange Act of 1934, 15 U.S.C.A. § 78o-3, was added by the so-called Maloney Act in 1938. This amendment provides for registration with the SEC of one or more “national securities association.” Those portions of the statute applicable to this case are set out in the margin. The National Association of Securities Dealers, Inc., herein referred to as NASD, has been registered under the provisions of this act.

On December 11, 1956, a complaint against petitioner was filed by the District Business Conduct Committee No. 2 of the NASD. In this complaint the petitioner was charged with “selling securities to customers at prices which were not fair in view of all the relevant circumstances” in violation of Sections 1 and 4 of Article III of the Rules of Fair Practice of the NASD. The District Business Conduct Committee found that petitioner had violated the…