Casey, Hon. William J., Chairman, Securities and Exchange Celler, Hon. Emanuel, a Representative in Congress from the State of Delahunty, Christopher J., President, Pacific Coast Stock Exchange Haack, Robert W., President, New York Stock Exchange, Inc., ac- companied by Donald L. Calvin, Vice President.. Howland, Richard B., President, Stock Clearing Corporation, New Kaestner, Frank W., Senior Vice President, Manufacturers Hanover Loeffler, Robert M., Senior Vice President-Law, Investors Diversified Services, Inc.; accompanied by Richard M. Phillips, Esq., of Hill, Christopher & Phillips, Special Counsel to IDS.. Loomis, Hon. Philip A., Jr., Commissioner, Securities and Exchange Macklin, Gordon S., President, National Association of Securities Dealers, Inc., accompanied by Lloyd J. Derrickson, Vice President Maller, Robert R., Senior Vice President, United States Trust Peake, Junius W., General Partner, Shields & Company- 1373, 1413, 1490 Pollack, Irving M., Director, Division of Trading and Markets, Noyes, Clifford H. 1549 O'Connor, Bernard, to include an article; illustrations; a speech by Fred R. Esty, Chairman of the Board, United States Banknote 1561 Peake, Junius W. 1377 Reinisch, Hans Randolph, to include article and attachments with illustrations___ 1696 American Stock Exchange: List of all members and top staff, including their places of residence 1496 Banking and Securities Industry Committee (BASIC): List of all members and top staff, including their places of residence 1494 Notes submitted by Herman W. Bevis on his study of the German, French, and of Morgan Guaranty's Euro-Clear depository ---Calvert, Gordon L., Investment Bankers Association of America: Letter dated October 6, 1971, urging prompt enactment of legislation abolishing stock certificate for use in interstate commerce-Celler, Hon! Emanuel: Letter dated November 12, 1971, to Richard W. McLaren, re concern of antitrust implications of the New York Stock Exchange_ 1509 1580 1646 Ernst, Martin L., Vice President, Arthur D. Little, Inc.: Letter dated October 15, 1971, elaborating on industry's automation problems. 1577 Federal Bar Journal: Article entitled "The Status of Regulatory Independence," by A. Everette MacIntyre... 1811 McLaren, Richard W.: Letter dated November 19, 1971, in reply 1650 1524 Letter dated July 22, 1971, from Gordon S. Macklin, in reply 1426 List of all members and top staff including their places of residence 1498 Letter dated November 18, 1971, submitting views in planning a 1531 National Clearing Corporation: List of all members and top staff, Letter dated July 8, 1971, setting forth NYSE thoughts on the 1499 1424 Letter dated October 22, 1971, setting forth a listing of the names, 1494 Material relating to the incorporation of the New York Stock 1755 Nicholson, Clayton M., Vice President of the Stock Transfer Associa- Perkins, John H., Chairman of the National Coordinating Group for Securities and Exchange Commission: Letter dated December 15, 1971, setting forth SEC opinion re- Material relating to the incorporation of the New York Stock Reply to letter of October 4, 1971, to Hon. John E. Moss, with Report of the SEC regarding comments on pending legislation, Securities Exchange Act release 8543 and other sundry releases. Page 1534 1632 1440 1534 1415 1757 1800 1395 1709 1458 1450 1585 Article entitled "Securities Struggle Battle for Influence Over 1419 Letter dated October 4, 1971, from Hon. John E. Moss to Hon. Letter dated October 20, 1971, from Hon. John E. Moss, to George Shultz, George P.: Letter dated November 10, 1971, in reply to Moss... Weinberg, Eli, article from Bank Administration, May 1971, en- 1666 1800 1808 1809 1808 1809 1533 1581 PARTS 4 AND 5 APPENDIXES R. Four Proposed Uniform Forms-Transfer Instruction Delivery Ticket M. Answers to Questions, by Herman W. Bevis, Executor Director, N. Comprehensive Securities Depository System-Study of Canceled P. Research Report on Making the Certificate Machine-Readable _ _ Page 1833 1838 1869 1888 1893 1895 S. The Billion-Share Automated Securities Depository (Central Certificate 1908 T. Memorandum of Understanding on a Comprehensive Securities Depository System.. 1922 U. Chronology of the New York Stock Exchange, Stock Clearing Corporation__. 1929 V. Operating Rules of the National Clearing Corporation 1935 X. OCR Equipment for Reading Stock Certificates (Report to BASIC- W. Report and Recommendations of the Security Imprinting and Processing Task Force of the Committee on Uniform Security Identification Procedures_ 1960 1971 Y. Letter from Chairman Casey of SEC to Mr. Moss regarding fails, with charts, tables, and exhibits.. 2012 Z. Suggest approach to the National Clearing Problem, with charts and exhibits 2039 AA. Securities Industry Overview Study. 2055 BB. Paper Crisis in the Securities Industry: Causes and Cures 2159 230 236 EE. The Multiple Causes of Fails in Stock Clearing in the United States (Volumes I and II)__ 241 FF. A Securities Handling System for the 1975 Era-Report to New 256 GG. Reducing Costs of Stock Transactions: A Study of Alternative Trade 259 261 267 JJ. KK. A Presentation for the Elimination of the Stock Certificate, by Reducing Costs of Stock Transactions: A Study of Alternative Trade 276 285 MONDAY, OCTOBER 18, 1971 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON COMMERCE AND FINANCE, COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE, Washington, D.C. The subcommittee met at 10:15 a.m., pursuant to notice, in room 2321, Rayburn House Office Building, Hon. John E. Moss (chairman) presiding. Mr. Moss. The subcommittee will be in order. This morning the Subcommittee on Commerce and Finance of the House Committee on Interstate and Foreign Commerce opens the fourth in its series of hearings in its study of the securities industry. In our last hearing we focused on problems of accounting, specifically the need for uniform accounting procedures and uniform and more extensive disclosure to customers of broker-dealers' financial condition, as well as the adequacy of audit procedures. Now we shall turn to another important problem, namely, the pervasive effect of the stock certificate as a primary factor in back office difficulties and an obstacle to the rapid and efficient processing of transactions both on the exchanges and over the counter. These hearings will focus on the feasibility and desirability of one or more depositories to immobilize stock certificates, the development of a machine-readable certificate and accompanying documents, and the development of a more efficient system for clearance, settlement, delivery, and transfer of securities. A later hearing, scheduled for October 26 and 27, will consider the possibility of totally eliminating the stock certificate. As in our prior hearings, we have determined that this hearing will take the form of a panel discussion rather than the usual formal presentation of statements. In this way, the subcommittee hopes, it will be possible to achieve an interchange of views, both between this subcommittee and the panelists and between the panelists themselves. At the outset, each panelist has been asked to present a brief summary of his views. The written statements will, of course, be made a part of the record and the Chair, at this point, requests unanimous consent to include such statements in the record as they are presented. Is there objection? Hearing none, that will be the order of the committee. I appreciate the difficulties inherent in the next request, but I ask that you keep your summaries as brief as possible. I hope that 10 minutes will suffice. If there are points left uncovered, you may pick them up at a later stage in our discussion. |