This case arises under the Securities Act of 1933, c. 38, 48 Stat. 74, as amended by Act of June 6, 1934, c. 404, 48 Stat. 881, U.S.C. title 15, § 77a et seq. (15 U.S.C.A. § 77a et seq.). Prior to the amendment, the act was administered by the Federal Trade Commission; but by Securities Exchange Act of 1934, § 210, 48 Stat. 908 (15 U.S.C.A. § 78ii), the administration was transferred to the respondent.
The act, section 2(4), 15 U.S.C.A. § 77b(4), defines the term 'issuer' as including every person who issues or proposes to issue any security, with certain exceptions. Section 6(a) of the act (15 U.S.C.A. § 77f(a) provides: 'Any security may be registered with the Commission under the terms and conditions hereinafter provided, by filing a registration statement in triplicate, at least one of which shall be signed by each issuer.' The filing of the registration statement must be accompanied by the payment to the commission of a fee measured by the maximum aggregate price at which the securities are to be offered. The information contained in the statement is to be made available to the public under such regulations as the commission may prescribe. The act prescribes in detail the character of information which is to be set out in the statement. Elaborate provisions are made in respect of liability on account of false registration statements, etc., and penalties are imposed for willful violations of any of the provisions of the act, or the rules and regulations promulgated by the commission under authority thereof, and for willfully untrue statements of material facts or omissions to state material facts. Section 5(a), 15 U.S.C.A. § 77e(a), provides that 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 the instrumentalities of interstate commerce or of the mails to sell or offer to buy such security, etc., or to transport any such security for sale or for delivery after sale.
'Sec. 8(a) The effective date of a registration statement shall be the twentieth day after the filing thereof, except as hereinafter provided, * *
'(d) If it appears to the Commission at any time that the registration statement includes any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading, the Commission may, after notice by personal service or the sending of confirmed telegraphic notice, and after opportunity for hearing (at a time fixed by the Commission) within fifteen days after such notice by personal service or the sending of such telegraphic notice, issue a stop order suspending the effectiveness of the registration statement. * *
'(e) The Commission is hereby empowered to make an examination in any case in order to determine whether a stop order should issue under subsection (d). In making such examination the Commission or any officer or officers designated by it shall have access to and may demand the production of any books and papers of, and may administer oaths and affirmations to and examine, the issuer, underwriter, or any other person, in respect of any matter relevant to the examination, and may, in its discretion, require the production of a balance sheet exhibiting the assets and liabilities of the issuer, or its income statement, or both, to be certified to by a public or certified accountant approved by the Commission. If the issuer or underwriter shall fail to cooperate, or shall obstruct or refuse to permit the making of an examination, such conduct shall be p oper ground for the issuance of a stop order.' 15 U.S.C.A. § 77h(a, d, e).
Section 19(b), 15 U.S.C.A. § 77s(b), provides that for the purpose of all investigations which the commission think necessary and proper for the enforcement of the act, any member of the commission or any designated officer may administer oaths and affirmations, subpoena witnesses, take evidence, and require the production of books, papers, etc. Section 22(b), 15 U.S.C.A. § 77v(b), provides that in case of contumacy or refusal to obey a subpoena issued (by authority of the commission) to any person, the District Courts of the United States and others named, upon application by the commission, may issue to such person an order requiring him to appear before the commission or one of its examiners, and there produce documentary evidence and give evidence touching the matter in question.