Breeden Supports Penny Stock Bill: SEC Chairman...

Breeden Supports Penny Stock Bill: SEC Chairman Richard C. Breeden told a House panel that he supports the objectives of a bill to curb penny stock fraud but fears it may cause as many problems as it solves. Penny stocks are low-cost, high-risk securities, usually trading for less than $3 per share. They are not listed on stock exchanges, and reliable, up-to-the-minute information about them is hard to obtain. The Penny Stock Reform Act of 1990, introduced earlier this month by Rep. Edward Markey (D-Mass.), would implement several reforms, including requiring that all penny stocks trade through an automated stock quote system and beefing up the SEC’s power to bar crooked promoters and consultants from pushing highly speculative stocks on unsophisticated investors.