Securities regulation in the United States is the field of U. The term is usually understood to include both federal- and state-level regulation by purely governmental regulatory agencies, but sometimes may also encompass listing requirements of exchanges like the New York Stock Exchange and rules of self-regulatory organization s like the Financial Industry Regulatory Authority FINRA. On the federal level, the primary securities regulator is the Securities and Exchange Commission SEC.

Futures and some aspects of derivatives are regulated by the Commodity Futures Trading Commission CFTC. FINRA is a self-regulatory organization that promulgates rules that govern broker-dealers and certain other professionals in the securities industry.

Who Regulates the Financial Markets? - dummies

It was formed by the merger of the enforcement divisions of the National Association of Securities Dealers NASD and the New York Stock Exchange. FINRA, like the exchanges and the Securities Investor Protection Corporation SIPC , is overseen by the SEC, and in general FINRA's rules are subject to SEC approval. All brokers and dealers that are registered with the SEC pursuant to 15 U.

The SIPC, like the exchanges and FINRA, is overseen by the SEC, and the SIPC's rules are generally subject to SEC approval. The federal securities laws were largely created as part of the New Deal in the s. There are five major federal securities laws:. Since these laws were originally enacted, Congress has amended them many times.

The Holding Company Act and the Trust Indenture Act in particular have changed significantly since then. The titles listed above, including the year of original enactment, are the so-called "popular names" of these laws, and practitioners in this area reference these statutes using these popular names e. When they do so, they do not generally mean the provisions of the original Acts; they mean the Acts as amended to date.

When Congress amends the securities laws, those amendments have their own popular names a few prominent examples include Securities Investor Protection Act of , the Insider Trading Sanctions Act of , the Insider Trading and Securities Fraud Enforcement Act of and the Dodd-Frank Act.

These acts often include provisions that state that they are amending one of the five primary laws. Other laws passed since then include Private Securities Litigation Reform Act , Sarbanes—Oxley Act , Jumpstart Our Business Startups Act , and various other federal securities laws.

Although practitioners in this area use these popular names to refer to the federal securities laws, like many U. Code, the official codification of U.

They are contained in Title 15 of the U. Thus, for example, the official code citation for Section 5 of the Securities Act of is 15 U. Not every law adopted by Congress is codified, because some are not appropriate for codification. For example, appropriations statutes are not codified. There are also extensive regulations under these laws, largely made by the SEC. One of the most famous and often used SEC rules is Rule 10b-5, which prohibits fraud in securities transactions as well as insider trading.

Because interpretations under rule 10b-5 often deem silence to be fraudulent in certain circumstances, efforts to comply with Rule 10b-5 and avoid lawsuits under 10b-5 have been responsible for a large amount of corporate disclosure. The federal securities laws govern the offer and sale of securities and the trading of securities, activities of certain professionals in the industry, investment companies such as mutual funds , tender offers, proxy statements, and generally the regulation of public companies.

Public company regulation is largely a disclosure-driven regime, but it has grown in recent years to the point that it begins to dictate certain issues of corporate governance.

State laws governing issuance and trading of securities are commonly referred to as blue sky laws. Before the Wall Street Crash of , there was little regulation of securities in the United States at the federal level.

The crash spurred the Congress to hold hearings, known as the Pecora Commission , after Ferdinand Pecora. After holding hearings on the abuses, Congress passed the Securities Act of This statute prescribed rules for the interstate sales of securities and made it illegal to sell securities into a state without complying with that state's laws.

The statute requires companies which want to sell securities publicly to file a registration statement with the U.

Securities and Exchange Commission. The registration statement provides a broad range of information about the company and is a matter of public record. The SEC does not approve or disapprove the issue of securities , but rather permits the filing statement to "become effective" if sufficient required detail is provided, including risk factors.

The company can then begin selling the stock issue, usually through investment bankers. The following year, Congress passed the Securities Exchange Act of , to regulate the secondary market general-public trading of securities. Initially, the Act applied only to stock exchanges and their listed companies as the word "Exchange" in the Act's name implies.

In the late s, the Act was amended to provide regulation of the over-the-counter OTC market i. In , the Act was amended to apply to companies traded in the OTC market. After these acts, courts interpreted the laws, assembling a body of United States securities case law.

In the Supreme Court of the United States decided Basic Inc.

Investment Advisers | ywepubuy.web.fc2.com

Levinson , which allowed for class action lawsuits under SEC Rule 10b-5 and the "fraud-on-the-market" theory, which resulted in an increase in securities class actions. In October , the Securities and Exchange Commission issued the Regulation Fair Disclosure regulation Reg FD , which required publicly traded companies to disclose material information to all investors at the same time. Reg FD helped level the playing field for all investors by helping to reduce the problem of selective disclosure.

In , the Dodd—Frank Wall Street Reform and Consumer Protection Act was passed to reform securities law in the wake of the financial crisis of — From Wikipedia, the free encyclopedia. Stoneridge Investment Partners, LLC v. The Political Economy of Securities Class Action Reform. Cato Supreme Court Review. Retrieved from " https: United States securities law Financial regulatory authorities of the United States.

Navigation menu Personal tools Not logged in Talk Contributions Create account Log in. Views Read Edit View history. Navigation Main page Contents Featured content Current events Random article Donate to Wikipedia Wikipedia store.

Interaction Help About Wikipedia Community portal Recent changes Contact page. Tools What links here Related changes Upload file Special pages Permanent link Page information Wikidata item Cite this page.

Languages Deutsch Edit links. This page was last edited on 5 May , at Text is available under the Creative Commons Attribution-ShareAlike License ; additional terms may apply.

By using this site, you agree to the Terms of Use and Privacy Policy.

Privacy policy About Wikipedia Disclaimers Contact Wikipedia Developers Cookie statement Mobile view.