Essential Aspects of Financial and Securities Regulation
What comes to mind when you hear financial and securities regulation? Regulation is made up of rules that must be followed, restrictions that must be adhered to, as well as guidelines to carry out certain things. A central regulator, which could be a government or non-government facility, is placed in charge of certain regulations. It is vital that institutions are regulated to avoid chaos.
It is vital that the financial and securities market is regulated. When the financial and securities industry is regulated well, instability will be avoided. Regulation of the financial and securities market ensures there is promotion of goods ethics in the handling of financial details. The importance of financial and securities regulation ensures that financial institutions can easily expand their financial products. There will also be enhanced confidence in financial institutions if there is a good regulatory authority in the financial and securities market. Consumer protection is also another reason why the regulation of financial and securities markets is important.
Who regulates financial and securities markets? Financial and securities regulations is a branch of financial law. Different countries have different financial regulators. It is good for you to know that financial regulators can be depended on governments or not. The United States financial and securities market is regulated by different authorities including the SEC, CFTC, among others. Each country has their own financial and securities regulations authority.
Which industry players come to mind when you think about the financial and securities industry? Securities include debt securities such as bonds and debentures, equity securities such as common stock, and derivatives such as futures, forwards, swaps and options. Other financial instruments include insurance products.
There are a number of laws that are applied in the regulation of the financial and securities industry. All countries have set rules that govern financial affairs in the country. You should be aware of some of the financial and securities laws applicable in the United States. You should fully understand all the regulations of the Securities Act of 1933 in the United States. The main aim of the Securities Act of 1933 is to make all the financial securities information available. The Securities Act of 1933 was made to avoid fraud and other malicious activities when selling financial securities.
The securities market in the USA is also regulated by the Securities Exchange Act of 1934. The Securities Exchange Act of 1934 gives the SEC powers to perform various activities. The other law is the Trust Indenture Act of 1939 which regulates debt securities. Other laws applicable in the United States are the Investment Company Act of 1940, Jumpstart Our Business Startups Act of 2012, Sarbanes-Oxley Act of 2002, Investment Advisers Act of 1940, and the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.