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What are blue sky laws?

BLUE Laws sky
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What are blue sky laws?

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While the SEC directly, and through its oversight of the NASD and the various Exchanges, is the main enforcer of the nation’s securities laws, each individual state has its own securities laws and rules. These state rules are known as “Blue Sky Laws”.

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Every state has its own securities laws­commonly known as “Blue Sky Laws”­that are designed to protect investors against fraudulent sales practices and activities. While these laws can vary from state to state, most states laws typically require companies making small offerings to register their offerings before they can be sold in a particular state. The laws also license brokerage firms, their brokers, and investment adviser representatives.

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