Which organization besides the SEC regulates brokerage firms and securities markets in the US?

Which organization besides the SEC regulates brokerage firms and securities markets in the US?

• A. The Securities and Exchange Commission
• B. Environmental Protection Agency
• C. Financial Industry Regulatory Authority
• D. Federal Aviation Administration

Answer: (C)

The important idea is that, in the United States, the day-to-day regulation of brokerage firms and how securities markets operate is handled by a key self-regulatory organization in addition to the SEC. The Financial Industry Regulatory Authority oversees broker-dealers, licenses registered reps, writes rules for conduct, conducts exams, and enforces compliance. It works under SEC oversight and coordinates with other regulators to keep the markets fair and orderly. Because FINRA is specifically focused on broker-dealers and the workings of securities markets, it’s the right choice for this question. The other options regulate entirely different areas—environmental protection and aviation safety—so they don’t regulate brokerage firms or securities markets.

The important idea is that, in the United States, the day-to-day regulation of brokerage firms and how securities markets operate is handled by a key self-regulatory organization in addition to the SEC. The Financial Industry Regulatory Authority oversees broker-dealers, licenses registered reps, writes rules for conduct, conducts exams, and enforces compliance. It works under SEC oversight and coordinates with other regulators to keep the markets fair and orderly. Because FINRA is specifically focused on broker-dealers and the workings of securities markets, it’s the right choice for this question. The other options regulate entirely different areas—environmental protection and aviation safety—so they don’t regulate brokerage firms or securities markets.