THE DISTRIBUTION OF SECURITIES 93
to be listed, the Exchange endeavors to prevent forged certifi-
cates from gaining circulation. “The part that the New York
Stock Exchange plays in this regard,” declared a financial expert
of long experience in Wall Street,'® “may be compared to the
creation of the national banks and their notes of issue, after
the era of wild cat private bank note currency.” The preven-
tion of forgery is, of course, basic to the ready negotiability
which is so important and advantageous a characteristic of
securities listed on the Exchange.
Transfer and Registry Offices.—Corporations which list
their registered shares on the Exchange must maintain two
separate offices or agencies in the Borough of Manhattan, City
of New York—one for their transfer and the other for their
registration. In some cases, the transfer offices are simply
departments of the corporation, but often companies prefer to
pay banks or trust companies to act for them in the capacity
of transfer agent. But the registrar must always be some insti-
tution (such as a bank or trust company) completely inde-
pendent of the corporation. Although the corporation pays
for the services of the registrar, the latter is under binding
agreements to the Stock Exchange, and will not register addi-
tional stock until the Committee on Stock List gives authority
for it. Stock certificates listed on the Exchange are not valid
until countersigned by the transfer agent and registered by the
registrar, and thus the public is protected not only against
security forgeries, but also against the secret overissuance of
stock by an unscrupulous corporation.
Bearer securities naturally do not need transfer, but as a
rule a registrar is required to authenticate them for the market.
Responsibility of the Stock Exchange.—The listing re-
quirements also call for a statement from the company as to its
corporate structure, its past earning record, its assets and lia-
bilities, etc. The purpose of the requirements is to make avail-
10 Article by Duncan MacGregor in the Financial Barometer.
