ASSOCIATED SECURITIES CORPORATION, A UTAH CORPORATION, AND NORMAN B. JENSON, PETITIONERS,

v.

SECURITIES AND EXCHANGE COMMISSION, RESPONDENT. IN THE MATTER OF ASSOCIATED SECURITIES CORPORATION, A UTAH CORPORATION

BREITENSTEIN, Circuit Judge. We have here a petition under Section 25(a) of the Exchange Act1 to review an order of the Securities and Exchange Commission revoking the registration of petitioner Associated Securities Corporation and naming petitioner Jenson as the cause of such revocation. Associated was registered as a broker and dealer in securities under § 15 of the Exchange Act.8 In the period February, 1958 to March, 1959 Jenson was the executive vice-president and treasurer of Associated.

Section 15(b) provides for the registration of brokers and dealers and for the revocation of such registration if the Commission finds that the revocation is in the public interest and that the broker or dealer has violated any provision of the Securities Act2

The record does not sustain these contentions. Their own exhibits refer to purchases of shares rather than contract rights.

Additionally, 176 shares were purchased from shareholders rather than contract holders. The purchases were not made as a result of distress sales as New Hemisphere had not invoked the forfeiture provisions of the installment contracts and Associated was aware of the desire of New Hemisphere not to take advantage of the forfeiture provisions.

The evidence of other sales at prices comparable to the sale prices of Associated, at the most, created a conflict in the evidence. The question of the market price of a security handled on an over-the-counter basis is one calling for the exercise of the expertise of the Commission and its findings in that regard may not be upset by the courts if supported by substantial evidence. Petitioners insist that there is no substantial evidence to support the Commission finding that it was in the public interest to revoke the registration of Associated.15 The supporting argument is bottomed on the theory that there could have been an honest difference of opinion as to the market price and hence the conduct was not wilful. The balancing of private detriment against public harm requires the fair and proper exercise by the Commission of its discretionary powers. The evaluation of facts and the exercise of judgment for the protection of investors dealing in over-the-counter securities is a function assigned by Congress to the Commission rather than the courts and the exercise by the Commission of its discretionary powers will not be upset by the courts except for cogent reasons.16 An examination of the entire record establishes that the revocation of the Associated registration was based on substantial evidence and that the Commission did not abuse its discretion. Petitioner Jenson urges that the Commission could not legally find him to be the cause of the revocation of the Associated registration under Section 15A (b) (4) (C) of the Exchange Act17 because of the provisions of paragraph (m)18 of that section which make it inapplicable to transactions in exempted securities and because Section 3(a) (11) of the Securities Act19 exempts securities sold, as in the instant case, only to persons “resident within a single State.” This argument falls for two reasons.

First, paragraph (m) is a part of the Exchange Act and the reference to exempted securities must refer to those exempt under that Act — not those exempt under the Securities Act. In the Exchange Act the term “exempted security” is specifically defined and does not include those with which this case is involved.20 In the second place, if the Securities Act does apply the Section³ (a) (11) exemption does not control because a violation was charged and found of the anti-fraud provisions of that Act contained in § 1721 and § 17 specifically provides in its paragraph (c)22 that the Section³ exemptions do not apply to fraudulent transactions involving the use of the mails. While the transactions were with Utah residents, the mails were used.

Affirmed. . 15 U.S.C.A. § 78y(a). . 15 U.S.C.A. § 780. . 15 U.S.C.A. § 77a et seq. . 15 U.S.C.A. § 78a et seq. . 15 U.S.C.A. § 77q(a). . 15 U.S.C.A. § 78j(b). . 17 C.F.R. 240.10b-5. . 15 U.S.C.A. § 780(c) (1). . 17 C.F.R. 240.15cl-2. . 15 U.S.C.A. §780— 3(b) (4). . Stadia Oil & Uranium Company v. Wheelis, 10 Cir., 251 F. 2d 269, 275. . 15 U.S.C.A. § 78y(a). . Charles Hughes & Co. v. Securities and Exchange Commission, 2 Cir., 139 F. 2d 434, 436, certiorari denied 321 U.S. 786, 64 S.Ct. 781, 88 L.Ed.

1077. In the Hughes case the markups ranged from 16.1% to 40.9%. . Hughes, supra, 139 F. 2d at page 439. .

Section 15(b), 15 U.S.C.A. § 780(b) authorizes revocation if the Commission finds such revocation “is in the public interest.” . Associated Securities Corp. v. Securities and Exchange Commission, 10 Cir., 283 F. 2d 773, 775. . 15 U.S.C.A. § 780 — 3(b) (4) (C). . 15 U.S.C.A. § 780 — 3(m). . 15 U.S.C.A. § 77c(a) (11). .

Section 3(a) (12) of the Exchange Act, 15 U.S.C.A. § 78c (a) (12). . 15 U.S.C.A. § 77q. . 15 U.S.C.A. § 77q(c).