ADMINISTRATION OF THE STOCK EXCHANGE 447 
pended or expelled as the said Committee may determine, unless the 
offense is the violation of a resolution or rule for which a different 
penalty has been provided, in which case such other penalty may be 
imposed. 
The latitude and degree of the governors’ authority are 
further extended by another section of the same article® 
reading : 
The Governing Committee may, by a vote of a majority of all its 
existing members, suspend from the Exchange for a period not 
exceeding five years, a member who may be adjudged guilty of any 
act which may be determined by said Committee to be detrimental to 
the interest or welfare of the Exchange. 
Thus the power exercised by the governors is con- 
ferred in the most comprehensive terms. As the above and 
other sections of the Constitution indicate, they sit in absolute 
authority over every member and his partners. Penalties are 
often inflicted for acts that violate no formal law and that 
would not give a plaintiff any technical standing in a court of 
law. In their nature, therefore, Stock Exchange regulations 
are searching and ethical rather than merely legal rules. The 
high standard of conduct enforced by such thoroughgoing regu- 
lations as these is necessary for the absolute mutual confidence 
enjoyed by members in each other, in the exercise of their 
trading privileges. 
Disciplinary Methods.—The methods employed by the 
Governing Committee in disciplining members are swift but 
equitable. Having been presented with the charges made 
against him in writing, the accused member appears before 
the Governing Committee, sitting as the jury in his case— 
a jury which is expert in the complexities of Exchange 
transactions and which gets at the true facts of the case 
directly and keenly. They decide whether the accused mem- 
ber’s conduct has or has not violated the rules and principles 
of the Exchange. From their decision the member on trial 
"s Constitution, Article XVII, Sec. 8