Title 15, Commerce and TradeRelease 119-102
§78z Unlawful Representations
Title 15 › CHAPTER 2B — SECURITIES EXCHANGES › § 78z
Summary
If the Securities and Exchange Commission or the Board of Governors of the Federal Reserve looks at a security, a transaction, or a filed report — or does nothing about them — that does not mean they approved the security or said the report is true or not misleading. You may not tell a potential buyer or seller that the agency’s action or inaction counts as approval or proof the paperwork is correct. Doing that is illegal.
Full Legal Text
Title 15, §78z
Commerce and Trade, Source: USLM XML via OLRC
No action or failure to act by the Commission or the Board of Governors of the Federal Reserve System, in the administration of this chapter shall be construed to mean that the particular authority has in any way passed upon the merits of, or given approval to, any security or any transaction or transactions therein, nor shall such action or failure to act with regard to any statement or report filed with or examined by such authority pursuant to this chapter or rules and regulations thereunder, be deemed a finding by such authority that such statement or report is true and accurate on its face or that it is not false or misleading. It shall be unlawful to make, or cause to be made, to any prospective purchaser or seller of a security any representation that any such action or failure to act by any such authority is to be so construed or has such effect.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
References in Text
This chapter, referred to in text, was in the original “this title”. See
References in Text
note set out under section 78a of this title.
Amendments
1998—Pub. L. 105–353 substituted “Board of Governors of the Federal Reserve System” for “Federal Reserve Board”.
Executive Documents
Transfer of Functions
For
Transfer of Functions
of Securities and Exchange Commission, with certain exceptions, to Chairman of such Commission, see Reorg. Plan No. 10 of 1950, §§ 1, 2, eff. May 24, 1950, 15 F.R. 3175, 64 Stat. 1265, set out under section 78d of this title.
Reference
Citations & Metadata
Citation
15 U.S.C. § 78z
Title 15, Commerce and Trade
Last Updated
Aug 21, 2026
Release point: 119-102