Question

1) Identify the 5 different divisions of the SEC and give a one or two sentence description of what each does.

2) Find the information on the SEC website regarding "Boiler Room Schemes" - identify the 4 major tactics of this scheme.

Answer 1

1)
The following are the 5 Divisions

Division	Brief Description
Corporation Finance	It reviews all the documents that a public company is required to file with the SEC
Trading and Markets	The most vital function is to help SEC maintain fair and efficient capital markets.
Investment Management	The main function is to protect the investor and to promote capital formation through regulation of asset management industry.
Enforcement	It helps in ececuting the law enforcement function. It recommends investigation, civil actions and prosecution.
Economic and Risk Analysis	It is to provide economic analysis to support rule making and policy development

2)
Boiler room schemes are schemes that are run to entice as many investors to a scam as possible in order for personal gains through the following tactics

.

Tactic	Description
Threats	Scammers threat against the assets owned by the investor and it sometimes leads to the investor falling in their trap
Pressure to purchase quickly	Scammers always force the investor to invest quickly citing various reasons about timing the market. This is unethical
High returns no risk	There is a promise of unreasonably high returns without much of a risk. It is never true
Aggressive sales	Scammers try to use aggressive sale techniques