Congress
Congress is the top dog when it comes to who is regulating the
US stock markets. Congress has passed most major laws associated
with US stock exchanges; such as the Securities Act of 1933 and,
more recently, the Accounting Reform and Investor Protection Act
of 2002 (more commonly known as the ‘Sarbanes-Oxley’
Act after the Congressmen who sponsored the act).
In addition to setting the laws by which the US stock exchanges
are regulated, Congress also has overall control of the budget
of Securities and Exchange Commission and other federal and other
associated agencies.
The Securities and Exchange Commission
The Securities and Exchange Commission (SEC) is the top regulatory
body overseeing the US stock markets. The SEC registers all new
securities being listed on US stock markets and manages, ensures,
and enforces that US listed corporations submit their filings
in a timely manner.
The SEC can also veto any application submitted to issue securities
on the US stock markets.
National Association of Securities
Dealers
Following the SEC in the regulatory pecking order is the National
Association of Securities Dealers. The National Association of
Securities Dealers is a self-regulatory body that oversees the
practices of securities dealers. In the event that any securities
dealer passes the National Association’s examination, they’ll
be issued a license to sell securities. Conversely, if any securities
dealer is seen to have acted improperly, the National Association
can revoke or suspend the dealer’s license.
State Legislators
Although they may not feel that they are so low down in the pecking
order of who regulates US stock markets, it is a commonly held
belief that State legislators are next in line. In most cases,
state legislators regulate how securities may be sold in their
state – and this is especially true if the issuing entity
is registered in that State.
Brokerage Houses
Last in the long line of authorities who regulate the US stock
markets are the brokerage houses themselves. Most brokerage houses
have a good reputation that they need to keep of they want to
stay in business. As such, many have in place internal regulations
and rules that are as strict, if not stricter, than the rules
set by all of the above regulators.
Who Do I Go To If I Have A Complaint?
Obviously, who you go to if you have a complaint to make will
very much depend on the nature of your complaint. Nonetheless,
generally speaking you should address your initial complain to
the National Association of Securities Dealers, who will then
liaise with the brokerage house to see whether your complaint
has merit or not. However, if you think your complaint may be
more a technical issue within your State, you may wish to address
your initial complaint to your local State legislators.
