In the United States The United States of America is a federal constitutional republic comprising fifty states and a federal district. The country is situated mostly in central North America, where its forty-eight contiguous states and Washington, D.C., the capital district, lie between the Pacific and Atlantic Oceans, bordered by Canada to the north and Mexico to the, the Financial Industry Regulatory Authority, Inc., or FINRA, is a private corporation that acts as a self-regulatory organization A self-regulatory organization is an organization that exercises some degree of regulatory authority over an industry or profession. The regulatory authority could be applied in addition to some form of government regulation, or it could fill the vacuum of an absence of government oversight and regulation. The ability of an SRO to exercise (SRO). FINRA is the successor to the National Association of Securities Dealers, Inc. (NASD). Though sometimes mistaken for a government agency, FINRA is not part of the U.S. government and is not a government agency—it is a private corporation that performs market regulation under contract with brokerage firms and trading markets.
FINRA regulates its members through the adoption and enforcement of rules and regulations governing the business conduct of its members. It often provides advice to the U.S. Securities and Exchange Commission The U.S. Securities and Exchange Commission is an independent agency of the United States government which holds primary responsibility for enforcing the federal securities laws and regulating the securities industry, the nation's stock and options exchanges, and other electronic securities markets. The SEC was created by section 4 of the (a U.S. government agency). FINRA also provides the binding arbitration service which investors (customers of Wall Street firms) are forced to agree to (through contracts of adhesion A standard form contract is a contract between two parties that does not allow for negotiation, i.e. take it or leave it. It is often a contract that is entered into between unequal bargaining partners, such as when an individual is given a contract by the salesperson of a multinational corporation. The consumer is in no position to negotiate the), rather than being able to bring their disputes against Wall Street firms and stock brokers, for example, into the federal court system for a judge or jury to rule upon.
FINRA focuses on regulatory oversight of all securities firms that do business with the public; professional training, testing and licensing of registered persons; arbitration and mediation; market regulation by contract for the New York Stock Exchange The New York Stock Exchange is a stock exchange located at 11 Wall Street in lower Manhattan, New York City, New York, USA. It is the largest stock exchange in the world by United States dollar value of its listed companies' securities. As of October 2008, the combined capitalization of all domestic NYSE listed companies was US$10.1 trillion, the NASDAQ The NASDAQ Stock Market, known as NASDAQ, is an American stock exchange. The full form is National Association of Securities and Dealers Automated Quotation. It is the largest electronic screen-based equity securities trading market in the United States. With approximately 3,700 companies and corporations, it has more trading volume than any other Stock Market, Inc., the American Stock Exchange NYSE Amex Equities, formerly known as the American Stock Exchange is an American stock exchange situated in New York. AMEX was a mutual organization, owned by its members. Until 1953 it was known as the New York Curb Exchange. On January 17, 2008 NYSE Euronext announced it would acquire the American Stock Exchange for $260 million in stock. On LLC, and the International Securities Exchange International Securities Exchange Holdings, Inc, International Securities Exchange Holdings, Inc., is a wholly owned subsidiary of German derivatives exchange Eurex. It is a member of the Options Clearing Corporation and the Options Industry Council (OIC), LLC; and industry utilities, such as Trade Reporting Facilities and other over-the-counter operations.
FINRA was formed by a consolidation of the enforcement arm of the New York Stock Exchange The New York Stock Exchange is a stock exchange located at 11 Wall Street in lower Manhattan, New York City, New York, USA. It is the largest stock exchange in the world by United States dollar value of its listed companies' securities. As of October 2008, the combined capitalization of all domestic NYSE listed companies was US$10.1 trillion, NYSE Regulation, Inc., and the NASD. The merger was approved by the United States Securities and Exchange Commission The U.S. Securities and Exchange Commission is an independent agency of the United States government which holds primary responsibility for enforcing the federal securities laws and regulating the securities industry, the nation's stock and options exchanges, and other electronic securities markets. The SEC was created by section 4 of the (SEC) on July 26, 2007.[1]
The opinion of NASD is that the regulatory consolidation will "increase efficient, effective, and consistent regulation of securities firms, provide cost savings to securities firms of all sizes, and strengthen investor protection and market integrity." According to NASD, additional benefits are to "streamline the broker-dealer regulatory system, combine technologies, and permit the establishment of a single set of rules and a single set of examiners with complementary areas of expertise within a single SRO."[2]
With respect to the regulatory agency merger, SEC Chairman Chris Cox Charles Christopher Cox , is a former Chairman of the U.S. Securities and Exchange Commission, a 17-year Republican member of the United States House of Representatives, and member of the White House staff in the administration of President Ronald Reagan. Prior to his Washington service he was a practicing attorney, teacher, and entrepreneur said, "The consolidation of NASD's and NYSE's member firm regulatory functions is an important step toward making our self-regulatory system not only more efficient, but more effective in protecting investors. The Commission will work closely with FINRA to eliminate unnecessarily duplicative regulation, including consolidating and strengthening what until have now been two different member rulebooks and two different enforcement systems."[3]
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Parent Directory NASD gif 23 Mar 1998 19 42 1 6K NCPD gif 23 Mar 1998 19 42 1 8K
