Protecting Investors and Maintaining Integrity: An Overview of FINRA's Role in Regulating the Financial Industry

The Financial Industry Regulatory Authority (FINRA) is a non-governmental organization that regulates and oversees the activities of financial brokers and broker-dealers in the United States. FINRA is responsible for enforcing the rules and regulations that govern the financial industry, including the Securities Exchange Act of 1934 and the Securities Act of 1933. In this blog post, we will provide an overview of FINRA and explain how it helps protect investors and maintain the integrity of the financial industry.

FINRA was created in 2007, when the National Association of Securities Dealers (NASD) and the New York Stock Exchange (NYSE) merged their regulatory functions. Today, FINRA is the largest independent regulator of securities firms in the United States, overseeing more than 3,700 broker-dealers and over 630,000 registered securities representatives.

FINRA's primary role is to protect investors by ensuring that broker-dealers and their representatives comply with federal and state securities laws, as well as FINRA's own rules and regulations. FINRA monitors the activities of broker-dealers and their representatives, conducts investigations into potential violations of securities laws and regulations, and takes enforcement action when necessary.

FINRA also provides education and training to broker-dealers and their representatives, as well as to investors, to help them better understand the securities industry and the regulatory environment in which it operates. FINRA's education and training programs cover topics such as investor protection, anti-money laundering, and cybersecurity.

In addition, FINRA operates a dispute resolution forum that provides a cost-effective and efficient way for investors to resolve disputes with broker-dealers and their representatives. FINRA's dispute resolution forum, known as the Financial Industry Regulatory Authority Dispute Resolution (FINRA DR), is the largest securities dispute resolution forum in the world.

In conclusion, FINRA is a non-governmental organization that regulates and oversees the activities of financial brokers and broker-dealers in the United States. FINRA's primary role is to protect investors and maintain the integrity of the financial industry by ensuring that broker-dealers and their representatives comply with federal and state securities laws, as well as FINRA's own rules and regulations. FINRA also provides education and training to broker-dealers and their representatives, and operates a dispute resolution forum for investors.