Sec. 510. REVIEW OF REGULATORY STRUCTURES AND PROCEDURES

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## SEC. 510 REVIEW OF REGULATORY STRUCTURES AND PROCEDURES **[**78s note**]** ###

(a)Review Required The Comptroller General, in consultation with the Securities and Exchange Commission, shall conduct a review of the rules, procedures, facilities, and oversight and enforcement activities of self-regulatory organizations under the Securities Exchange Act of 1934 with respect to penny stocks (within the meaning of section 3(a)(51) of such Act). Such review shall include an analysis of— ####

(1)the resources devoted by self-regulatory organizations to the detection, investigation, prosecution, and correction of fraud and abuse in the trading of such penny stocks; ####

(2)the methods and techniques used, and alternative methods which may be used, in those oversight and enforcement activities, including methods and techniques involving coordinated oversight and enforcement activities with other Federal and State authorities; ####

(3)the adequacy of the rules, procedures, and facilities of such self-regulatory organizations for the prevention of excessive spreads and markups, unscrupulous sales practices, and other conduct inconsistent with high standards of commercial honor and just and equitable principles of trade; ####

(4)any obstacles to or limitations on the authority of self-regulatory organizations that impair the conduct of those oversight and enforcement activities; ####

(5)the adequacy of current listing and maintenance requirements and procedures and the potential for erosion of such requirements and procedures due to issuer avoidance of penny stock designation and regulation; and ####

(6)such other matters as the Comptroller General considers necessary or appropriate. ###

(b)Report Within one year after the date of enactment of this Act, the Comptroller General shall submit a report on the review required by subsection (a). Such report shall include, in addition to a statement of findings with respect to each matter described in paragraphs

(1)through

(6)of such subsection, such recommendations as the Comptroller General considers appropriate with respect to legislative or administrative changes.