The Securities Act of 1933 is often referred to as the “truth in securities law”. The two basic principles of the Securities Act of Act of 1933 is 1) It requires that investors receive financial and other significant information concerning securities being offered for public sale; and 2) It established a law to prohibits deceit, misrepresentations, and other frauds in the sale of securities.

The Securities Act of 1933 governs the initial issuance and registration of securities and was designed to ensure more “transparency in financial statements” so investors can make informed decisions about investments. It requires better clear information to be disclosed and requires companies to register with the Securities and Exchange Commission. The Registration process is to ensure that companies provide the SEC and potential investors with all relevant information by means of a written prospectus and registration statement.

The ‘33 Act governs the initial issuance and registration of securities. The Securities Exchange Act of 1934 governs financial reporting, and the registration of people involved with the sale of securities.