What Is FINRA’s Role in Regulating RIAs?
The Financial Industry Regulatory Authority (FINRA), created in July 2007 is the largest non-governmental regulator for all securities firms doing business in the United States.
All told, FINRA oversees brokerage firms, branch offices and over 676,000 registered securities representatives.
As a trusted advocate for investors and consumers, FINRA is dedicated to investor protection by keeping the markets fair ensuring investor choice and proactively addressing emerging regulatory issues before they hurt investors or the markets.
FINRA’s chief role is to protect investors by maintaining the fairness of the U.S. capital markets.
FINRA conducts it’s primary objectives of writing and enforcing rules, examining firms for compliance with the rules, informing and educating investors, helping firms pre-empt risk and stay in compliance, and providing trade reporting and other industry utilities.
In order to make securities regulation more streamlined, FINRA has a new, single rulebook.
Merging the 2 rulebooks has been a complex task for FINRA. Not only are they choosing the very best of the legacy NASD and NYSE rules, but they are also determining if there are better ways to address regulatory concerns. Times are changing and the old rules do not always apply in today’s investment environment. Above all, FINRA will write new rules to make them as clear as possible for consumers. Increased clarity is the key to success in this complex market and will also foster compliance and enhance the soundness of the financial markets.
FINRA’s dedication to education of the investment community at large remains at the core of its charter.
FINRA oversees RIAs to make sure they are fully compliant to the rules and regulations of the investment market. There are an estimated 78 million baby boomers who are on the brink of retirement and are dependent on the future health of the financial markets. This is why FINRA’s regulatory status is paramount in protecting consumers.
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