Series 26

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Sales Activities - Sales Presentations and Use of Sales Tools


Securities Act of 1933: Section 5 - Prohibitions Relating to Interstate Commerce and the Mails


Sale or Delivery After Sale of Unregistered Securities
Unless a registration statement is in effect as to a security, it shall be unlawful for any person, directly or indirectly:

  • To make use of any means or instruments of transportation or communication in interstate commerce or of the mails to sell such security through the use or medium of any prospectus or otherwise; or

  • To carry or cause to be carried through the mails or in interstate commerce, by any means or instruments of transportation, any such security for the purpose of sale or for delivery after sale.

Necessity of Prospectus Meeting Requirements under Section 10
It shall be unlawful for any person, directly or indirectly:

  • To make use of any means or instruments of transportation or communication in interstate commerce or of the mails to carry or transmit any prospectus relating to any security with respect to which a registration statement has been filed under this title, unless such prospectus meets the requirements of section 10; or

  • To carry or cause to be carried through the mails or in interstate commerce any such security for the purpose of sale or for delivery after sale, unless accompanied or preceded by a prospectus that meets the requirements of section 10.

Securities Exchange Act of 1934: Section 10 - Regulation of the Use of Manipulative and Deceptive Devices

As mentioned in Section 5 of the Securities Exchange of 1933, the prospectus must also adhere to Section 10, which states the following:

The term "manipulative" or "deceptive device" is defined as any act or omission to act with respect to any security exempted from Section 12(a). This section is applicable to such security if such act or omission to act would have been unlawful under section 9(a) if done or omitted to be done with respect to a security registered on a national securities exchange, and the use of any means or instrumentality of interstate commerce or of the mails or of any facility of any national securities exchange to use or employ any such device or contrivance in connection with the purchase or sale of any such security is hereby prohibited.


Rule 10b-5 - Employment of Manipulative and Deceptive Devices
It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce, of the mails or of any facility of any national securities exchange:

  • To employ any device, scheme, or artifice to defraud;

  • To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or

  • To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person in connection with the purchase or sale of any security.
Registration and Regulation of Brokers and Dealers
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