PowerPoint presentation

Derius Hopkins

Purdue University Global

FI499 Bachelor’s Capstone in Finance

Dr. Ernesto Escobedo

6-10-23

Amazon has a history of close cooperation with authorities, as well as an effective policy on compliance. The company generally adheres to relevant financial regulations and laws. Within Amazon's hierarchy, there exists a team solely devoted to ensuring that the conglomerate complies with pertinent laws and regulations. A diverse array of topics, ranging from antitrust to securities to privacy, are overseen by skilled attorneys, accountants, and other professionals within this compliance squadron (Muhammad et al.,2013).

By implementing effective measures against fraudulent activities, Amazon is able to maintain a high level of control and security. This includes preventing financial discrepancies and misconduct within the organization as well as ensuring the safety of their customers through trustworthy goods and services. The company employs a set of rules and protocols to stay clear of any insider trading by corporate employees.

Issuance of corporate debt securities is regulated by a federal law known as the Trust Indenture Act of 1939. To issue corporate debt securities, a trust indenture must be agreed upon by both issuer and trustee. A trust indenture is essentially a contract, with the trustee tasked with ensuring that the issuer meets the terms of the indenture while protecting the interests of the bondholders. In response to numerous scandals involving bond defaults amongst corporations, the Trust Indenture Act of 1939 was brought into existence, with the aim of shielding bondholders from such a predicament. Issuers were now obligated to provide the investors with a greater amount of information about the terms of their investments. Additionally, issuers were to appoint self-governing trustees to watch over the release and reimbursement of debt securities, further fortifying the measures taken for the safeguard of the investors.

In regard to securities, two key laws in the United States are the Securities Act of 1933 and the Securities Exchange Act of 1934. The former handles the first public offering of securities, whereas the latter controls the security trade that occurs after the securities have been issued. The Securities and Exchange Commission (SEC) mandates that any organization offering securities to the public must submit a registration statement in compliance with the Securities Act of 1933. The said statement should contain specific details regarding the company and its securities. Following scrutiny, if the SEC deems the details to be insufficient for investors, a cease order may be enforced.

In 1934, the Securities Exchange Act was established, mandating that all firms trading securities on a national exchange must register with the SEC. Along with this, submitting regular reports, such as annual and quarterly reports and current reports, is also compulsory. The SEC also has the power to probe businesses for possible securities law infringements.

The Chartered Financial Analyst (CFA) designation requires adherence to the CFA Institute Code of Ethics and Standards of Professional Conduct, which outlines various ethical standards. These standards encompass the concept of integrity, objectivity, competency, diligence, and care.

Among investment professionals, the promotion of ethical behavior is a key objective of the CFA Institute Code of Ethics and Standards of Professional Conduct. CFA charter holders who choose to violate this code run the risk of being sanctioned by the CFA Institute. The CFA Institute Code of Ethics and Standards of Professional Conduct, the Securities Acts of 1933 and 1934, and the Trust Indenture Act of 1939 - does Amazon comply with all three of them?

Complying with the Trust Indenture Act of 1939, the Securities Acts of 1933 and 1934, and the CFA Institute Code of Ethics and Standards of Professional Conduct is something I believe Amazon is inclined to do.

References

Muhammad, M., Muhammad, M. R., & Khalil, K. M. (2013). Towards Shari’ah Compliant E-commerce Transactions: A review of Amazon. com.  Middle-East Journal of Scientific Research,  15(9), 1229-1236.

Nepstad, D. C., Stickler, C. M., & Almeida, O. T. (2006). Globalization of the Amazon soy and beef industries: opportunities for conservation.  Conservation biology,  20(6), 1595-1603.

Schmidt, C. A., & McDermott, C. L. (2015). Deforestation in the Brazilian Amazon: local explanations for forestry law compliance.  Social & Legal Studies,  24(1), 3-24.

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