SEC Chairman Arthur Levitt Jr. today announced several moves to provide investors with better information on bond prices. At a speech at the Media Studies Center, he said the NASD has agreed to adopt rules requiring dealers to report all U.S. corporate bond and preferred stock transactions to the NASD, to develop systems to receive and redistribute transaction prices in real time and to create a database of bond and preferred stock transactions. Moreover, he announced the NASD also will develop a surveillance program to better detect fraud to foster investor confidence in these markets. The announcement follows inquiries about SEC action on bond pricing information.
``Investors have a right to know the prices at which bonds are being bought and sold. This will help them make better decisions, and it will increase confidence in the fairness of the markets,'' said Mr. Leavitt.
He also announced preliminary findings of an SEC bond market review begun earlier this year, including anecdotal evidence suggesting individual investors are being sold mortgage-backed securities without being told about risk, as well as possible misuse of inside information in the high-yield market.