1. What is SEC? SEC stands for Security and Exchange Commission.

SEC is made of 5 commissioners that are handpicked by the president and also approved by the senate. Its purposes are to ensure that securities markets operate in a fair and orderly manner, that the professionals in the securities industry dont mistreat their customers and treat them fairly, that corporations state all material information about themselves publicly so that investors can make knowledgeable business decisions, and to issue new laws and amend laws pre-existing. In addition to what SEC already does, it also monitors the corporate takeovers in the U.S. To pursue these objectives, the SEC is split into 5 different divisions which each have their own purpose. These divisions are the Division of Corporate Finance, Division of Trading and Markets, Division of Inventory Management, Division of Enforcement, and Division Economic and Risk Analysis. There are also many different offices in the SEC. Each office has its own purpose to execute. 2. What are the names of the ACTS of congress that created the SEC? (Briefly describe each act in one paragraph) One of the ACTS of congress that created the SEC was the Act of Security of 1933. It was passed during the peak year of the Great Depression. The two main goals of the Act of was to ensure clearer financial statements so investors can make better informed decisions about investments, and to establish laws against misrepresentation and fraudulent activities in the securities markets. The other ACTS of congress that created the SEC was the Securities Exchange Act of 1934. This along with the Act of Security of 1933 created the SEC and successfully restored faith in capital markets by providing more reliable information and more honest dealings. The purpose of the Securities Exchange Act of 1934 was to provide securities transactions to secondary markets and regulate exchanges and broke-dealers in order to further protect the investing public. 3. Find an article about the SEC in ACTION (Something they are enforcing or investigating) and summarize the article in one or two paragraphs (8-10 sentences) type the name and webpage of the article above the Paragraph. http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370539726923#.Uo2dZMQ3uSo

SEC Charges Steven A. Cohen with Failing to Supervise Portfolio Managers and Prevent Insider Trading
Steven A. Cohen received charges on July 19, 2013 for taking part in illegal insider trades. The SECs Division of Enforcement claims that Mr. Cohen received highly suspicious information about a trade by his two portfolio managers, Mathew Martoma and Michael Steinberg. After learning more indepth of what went behind the scenes in the trade, it was too late for Cohen as he allegedly failed to comply with the law. Information later informed that Martoma and Steinberg obtained non- public

material information back in 2008, breaking one of the objectives of the SEC which is to have corporations make public all material information about themselves. As investigation proceeded, it was shown that Cohen had at least 2 chances to see through Martoma and Steinbergs inside trades. But on both occasions, Cohen failed to see the possible indication that inside trade was taking part. The SECs Division of Enforcement agreed that Cohen has failed reasonably to supervise over Martoma and Steinberg, having broken section 10(b) of the Exchange Act and Rule 10b-5 thereunder. A relief for Cohen will be later determined through public interest of what the relief should be, including financial penalties, a supervisory and financial services industry bar, and other possible reliefs.