Page:United States Statutes at Large Volume 78.djvu/620

 578

15 USC yso'^^s

PUBLIC LAW 88-467-AUG. 20, 1964

[78 STAT.

" (B) determines that such acts or practices, or omission to act, are in violation of such rules of the association as have been designated in the determination of the association, the Commission shall by order dismiss the proceeding, unless it appears to the Commission that such action should be modified in accordance with paragraph (2) of this subsection. The Commission shall likewise determine whether the acts or practices prohibited, or the omission of any act required, by any such rule constitute conduct inconsistent with just and equitable principles of trade, and shall so declare. If it appears to the Commission that the evidence does not warrant the finding required in clause (A), or if the Commission determines that such acts or practices as are found to have been engaged in are not prohibited Iby the designated rule or rules of the association, or that such act as is found to have been omitted is not required b^ such designated rule or rules, the Commission shall by order set aside the action of the association. "(2) If, after appropriate notice and opportunity for hearing, the Commission finds that any penalty imposed upon a member or person associated with a member is excessive or oppressive, having due regard to the public interest, the Commission shall by order cancel, reduce, or require the remission of such penalty. "(3) In any proceeding to review the denial of membership in a registered securities association or the barring of any person from being associated with a member, if the Commission, after appropriate notice and hearing, and upon consideration of the record before the association and such other evidence as it may deem relevant, determines that the specific grounds on which such denial or bar is based exist in fact and are valid under this section, the Commission shall by order dismiss the proceeding; otherwise, the Commission shall by order set aside the action of the association and require it to admit the applicant broker or dealer to membership therein, or to permit such person to be associated with a member." (^) Section 15A(k)(2) of said Act is amended to read as follows: "(2) The Commission may in writing request any registered securities association to adopt any specified alteration of or supplement to its rules with respect to any of the matters hereinafter enumerated. If such association rails to adopt such alteration or supplement within a reasonable time, the Commission is authorized by order to alter or supplement the rules of such association in the manner theretofore requested, or with such modifications of such alteration or supplement as it deems necessary if, after appropriate notice and opport unity for hearing, it appears to the Commission that such alteration or supplement is necessary or appropriate in the public interest or for the protection of investors or to effectuate the purposes of this section, with respect to— " (A) the basis for, and procedure in connection with, the denial of membership or the barring from being associated with a member or the disciplining of members or persons associated with members, or the qualifications required for members or natural persons associated with members or any class thereof. " (B) the method fbr adoption of any change in or addition to the rules of the association. " (C) the method of choosing officers and directors. " (D) affiliation between registered securities associations." (f) Section 15A(1) of said Act is amended (1) by striking out the semicolon at the end of paragraph (1) thereof and inserting a period, and (2) by striking out paragraph (2) and inserting the following: "(2) after appropriate notice and opportunity for hearing, by order to suspend for a period not exceeding twelve months or

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