“That the acceptance and carrying of an account for a customer, either a member or a non-member, without proper and adequate margin, may constitute an act detrimental to the interest and welfare of the Exchange, and the offending member may be proceeded against under Section 8 of Article XVII of the Constitution. “That the improper use of a customer’s securities by a member or his firm is an act not in accordance with just and equitable principles of trade, and the offending member shall be subject to the penalties provided in Section 6 of Article XVII of the Constitution. “That reckless or unbusinesslike dealing is contrary to just and equitable principles of trade, and the offending member shall be subject to the penalties provided in Section 6 of Article XVII of the Constitution, in every case in which the offense does not come within the provisions of Section 5 of Article XVI thereof.” It is one thing to adopt a rule, but it is quite another to enforce it. In order that there might be no miscarriage on this point, the Exchange on March 5, 1913, took the one necessary step to make these reforms effective by the appointment of a Committee on Business Conduct, as follows: “Fourth: A Committee on Business Conduct, to consist of five Members. “It shall be the duty of this Committee to consider matters relating to the business conduct of members with respect to customers’ accounts. “It shall also be the duty of this Committee to keep in touch with the course of prices of securities listed on the Exchange, with the view of determining when improper transactions are being resorted to. “It shall have power to examine into the dealings of any members with respect to the above subjects, and report its findings to the Governing Committee.” This Committee is composed of Governors of the Exchange in actual business on the floor. Members call it “The Police Committee,” which is correct. Its members are constantly on the watch for evidences of wrongdoing, and the broad powers entrusted to them under the resolution above quoted give them ample authority to act summarily. I have watched them at their work and I have no hesitation in saying that this Committee is the most important influence for good that has ever been made a part of the machinery of any stock exchange in the world. The most prejudiced critic of the Exchange will I think admit the truth of this statement.